What Is Hire Purchase and How Does it Work?

Hire Purchase, also known as HP car finance, is one of the most common and popular ways for people to finance the purchase of a new or used car. Usually this payment option allows you to place a deposit and pay off the remaining value of the car over a number of monthly instalments with the remaining loan secured against the car. Some lenders will accept HP agreements without the need for paying a deposit upfront, which is where GetCarFinanceHere can help find the best hire purchase deal for you.

To find out if you are eligible to buy a car on hire purchase call us now on 01282 544532 or use our free quick check calculator to find out your eligibility without the need of a credit check.

There are a number of advantages of using a hire purchase agreement to purchase a new or used car, we have highlighted some of these below. If you want to find out more about HP finance call our friendly team on 01282 544532.

• Repayments can be flexible with payment terms normally between 1 to 5 years to help suit your monthly repayments. However, it is important to note that the longer the term the more interest you can pay.
• There is a relatively low amount of deposit required, this is normally around 10% of the cars value, with some lenders not requiring a deposit at all.
• HP agreements can have fixed rates of interest meaning that you know exactly what the monthly payments are going to be every month for the length of the agreement.
• Under some HP agreements you can return the car and not have to pay any more payments once you have paid off half of the cars value.
• If you have a poor to bad credit rating it may be easier to get a car using hire purchase compared to other payment options because the car itself is used as collateral.
• There are normally no mileage restrictions.