Hire Purchase
Hire Purchase
This is a legal contract to hire a car for an agreed period of time, normally two, three or four years, with a non cancellable option to purchase the car at the end of the period on the payment of an "Option Fee" which must be no more than 1% of the car's initial cost. In practice this is often waived or is just a token value of £1.
Until the option to purchase is exercised the vehicle remains the property of the Hire Purchase company although once over 50% of the payments have been made the right of lien (recovery) is no longer available to the HP company even after default of payment.
In all other respects vehicles funded through hire purchase are treated exactly as an outright purchase. Even though title does not pass until the end of the period the asset appears on the user's Balance Sheet. VAT is included in the capital cost of the vehicle.
Other fleet purchase options:
Outright Purchase
Lease Purchase
Car leasing explained
One of the most popular forms of car leasing in the UK is Contract Hire, which is available to both business users and consumers (private individuals).
Frequently asked questions
Leasing a car with us is very easy, and to help even more, we've complied a list of answers to some of the questions we get asked.
Car leasing jargon buster
Don’t let complicated terminology stop you finding the right car to lease. Our jargon buster explains some of the most commonly used words and phrases.
The Duke of Edinburgh’s Award
Car leasing made simple is proud to support The Duke of Edinburgh’s Award - making a difference to over 275,000 young people across the UK every year.
