Finance Schemes
HIRE PURCHASE
Hire Purchase is a traditional funding method whereby you borrow a proportion of the retail price of a vehicle over 2, 3, 4 or a 5 year period. Upon payment of the final installment (and any fees) the vehicle then belongs to the hirer.
LEASE PURCHASE
Very popular scheme which is similar to traditional Hire Purchase however there is a residual value (or balloon payment) at the end of the agreement. This facility allows the monthly payments of a particular vehicle to be much cheaper than Hire Purchase as the finance package defers a substantial amount of the loan until the end of the agreement term. The residual value is calculated on how old the vehicle will be at the end of the term and how many miles it will have on the clock.
MOTOR LOAN
This type of loan is used whereby the lender can offer advances over the retail price of the vehicle typically for deals where there is negative equity in a part exchange. The loan is not secured on the vehicle as traditional funding methods and in such is unsecured lending. Customer profiles need to be much stronger for this type of scheme as the risks are increased for the lender.
FINANCE LEASE
Rentals can be charged against taxable profits – the ideal scenario when there are insufficient taxable profits to claim all available capital allowances – while capital outlay is kept low and VAT can be spread over the period of the lease. Finance leases offer flexible funding that eases cash flow with the net proceeds from any resale of the goods paid back to the business at the end of the lease.