Hire Purchase has always historically been the way first thought of when looking to purchase new vehicles.  This is ideal if you wish to take full ownership of the vehicle where title will pass to you upon completion of the term of contract and where you are willing to be responsible for any depreciation and disposal at the end of the contract.

Businesses often consider this for vehicles which are specialist conversions and where the intention is to keep the vehicle for a long period of time. 

Lease Purchase can also be more commonly known as HP with a balloon. This is where a proportion of the initial vehicle cost is deferred until the last month of the contract, doing so will lower the monthly payments the end payment though is not guaranteed.

Alternatively many customers now consider Contract Purchase (CP) as a more effective route.  This is a way to potentially own the vehicle but with low monthly payments.  This is achieved by having a guaranteed minimum end value (GMEV) as a “balloon payment” at the end of the contract.  At the end of the agreement you have three options:-

• Pay the “balloon” and keep the vehicle
• Hand the vehicle back to the finance company
• Refinance the “balloon”