Hire Purchase is an ideal solution for businesses looking to take ownership of their company vehicles at the end of a finance agreement, once all payments have been made.
An initial deposit is agreed with the funder and paid at the start of the contract, followed by monthly instalments over a period of typically 2, 3 or 4 years. You have the flexibility to reduce the monthly payments by paying a final lump sum, known as a ‘balloon’ payment.
Unlike a lease or personal contract purchase, the residual value of the vehicle does not influence the amount of your monthly payments. Instead, they are determined by the deposit amount, length of contract and the retail price of the vehicle.
Businesses can usually claim ‘writing down’ allowances and capital grants by opting for Hire Purchase. It may also be possible to offset the interest of your repayments against your profits and reclaim VAT.
FleetEurope can provide administrative support for the vehicle throughout the hire purchase agreement, including servicing, maintenance, accident management and breakdown cover.
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