There are many finance solutions available, depending on your budget and circumstances. Our panel of lenders offer agreement terms between 12 and 60 months for Cars, Motorcycles and LCV’s and up to 120 months for Leisure Vehicles such as Motorhomes, all with flexible deposit options.
Hire Purchase (HP)
Hire Purchase is the most popular way of funding motor vehicles.
Payments are divided equally over the term at a fixed rate of interest and after the final repayment the vehicle becomes the property of the customer.
A deposit is usually required, and you can spread the repayments up to 60 months. The amount you borrow is secured against the vehicle.
At the end of the term there is no lump sum. Instead, you’ll have two options:
Pay an ‘option to purchase’ (OTP) fee and become the full legal owner of the vehicle
Hand the vehicle back to the lender and walk away (wear and tear restrictions apply)
PERSONAL CONTRACT PURCHASE (PCP)
PCP is great if you want to change or upgrade your car or motorcycle at the end of the finance term.
Under a PCP agreement the lender guarantees the minimum amount that the vehicle will be worth at the end of your agreement based on the agreed annual mileage and maintenance of the vehicle. This value is known as the ‘Guaranteed Minimum Future Value’ and by deferring this to the end of the term, you could benefit from lower fixed monthly payments compared to HP and CS products.
A deposit is usually required and the term can be 12 - 48 months. The finance is also secured against the vehicle.
At the end of the term you have three options:
Part-exchange – use any value left in your vehicle to part-exchange it for a new one.
Buy it – pay off the final payment (Guaranteed Minimum Future Value plus the Option to Purchase Fee (OTP)) in one lump sum and become the legal owner.
Hand the vehicle back to the lender and walk away (wear and tear restrictions apply)
CONDITIONAL SALE (CS)
With CS, you put down a deposit and borrow the remaining cost of the vehicle, paying it back over the term of the agreement which can be up to five years. Choose this option if you want to own the vehicle at the end of the term.
Repayments are fixed throughout the agreement and spread equally throughout the term. The amount you borrow is also secured against the vehicle. There is no lump sum to repay at the end of the agreement; however, under the terms of a CS agreement, you have an obligation to pay the title transfer fee and then you become the legal owner of the vehicle. A deposit is usually required, and the term can be up to 60 months. The finance is also secured against the vehicle.
LEASE PURCHASE (LP)
Lease Purchase helps you to buy a
vehicle with lower monthly payments
than a traditional hire purchase
agreement as a large proportion of
the amount you repay is deferred into
the Final Repayment. You will pay
more interest on an LP agreement
than a HP agreement for the same
loan amount, term and APR as your
balance reduces more slowly due to
the larger final repayment.
When the agreement ends, you can
own the vehicle by paying the final
repayment or part exchange the vehicle.
This product differs to PCP as there is
no vehicle return option at the end of
the agreement.
WHAT ELSE YOU NEED TO KNOW
Your Rights (Agreements regulated by the Consumer Credit Act)
Right of Withdrawal: You can change your mind and withdraw from the agreement without giving any reason during the first 14 days after you receive the executed copy of your agreement. This will bring the finance agreement to an end, but it does not automatically mean you can pull out of buying the vehicle or any insurance products/extras. If you withdraw, you must pay the lender the total amount of credit that you borrowed for the vehicle and any insurance products/extras and interest on it within 30 days.
Voluntary Termination: You have the right to end the agreement early and return the vehicle to us. If you do this, you need to pay the lender all repayments that have fallen due up to the time of termination. If at the point that you terminate, the amount you have paid for the vehicle (including the deposit) is less than half the total amount payable for the vehicle you will also need to make an additional payment to bring the amount up to this sum. You will also need to pay:
the outstanding balance less any rebate of charges due for any insurance products/extras and
any charges that may apply if you have not kept the vehicle in good repair or if you have exceeded the agreed maximum mileage allowance.
Satisfactory Quality Rights: You have rights against the lender if the vehicle is not of a satisfactory quality. If you experience problems with the vehicle, we will work with the lender and supplying dealer to try and resolve your concerns.
Early Settlement: You can pay off your agreement in full at any time, you may even get a rebate of some of your interest. Where applicable, the interest is calculated up-front and added to the balance at the start of your agreement. Whilst you pay an equal repayment amount each month, the amount of interest that you pay each month reduces over the life of the agreement so this will impact the level of rebate that you receive. Please refer to our guide on how settlement figures are calculated at the bottom of our website.