Hire Purchase and Finance Lease

Click Here to contact us

Hire Purchase / Lease Purchase / Finance Lease / Outright Purchase / Contract Hire / Personal Contract Hire / Contract Purchase / Personal Contract Purchase

Hire Purchase

Hire Purchase is similar to a car loan as you would pay for the whole amount of the vehicle over a fixed period of time. For example, if the car costs £10,000 you would simply agree a period of time over which to pay the £10,000 back, interest is added at the outset and then the total amount is divided equally over the repayment period. When you have finished making the payments the vehicle is owned outright by you.

A deposit is usually required which would reduce the amount you borrow.

The key features of Hire Purchase are:

Eventual ownership of vehicle
Fixed interest rates from the outset
Flexible deposit amounts
The car can be written down in your books-for businesses
All interest paid can be off-set against tax-for businesses
No balloon payment
No mileage restrictions
Option of early settlement
Repayment periods of 12 to 60 months
No VAT on payments
Back to Top

Lease Purchase

Lease Purchase is identical to Hire Purchase with the exception that instead of paying back the whole amount borrowed over a fixed period, you would defer some of the capital in the form of a balloon payment due at the end of the agreement.

The logic behind this is that as the vehicle will be worth something at the end of the agreement there is no need to pay all the capital as you can sell the car or van to cover the balloon payment.

A Lease Purchase agreement is determined by the cost of the vehicle, the contract length and the estimated future value of the vehicle which is based on the proposed annual mileage. In paying the “balloon figure” at the end of the contract you complete the agreement and the car is yours to keep. If you trade the car in for another, then any allowance over and above the balloon payment is yours and can be put towards your deposit on your next car. Likewise, if the allowance is less than the balloon, then you are responsible for the shortfall.

The key features of Lease Purchase are:

Eventual ownership of the vehicle
Flexible initial deposit
The car can be written down in your books-for businesses
All interest paid can be off-set against tax-for businesses
No VAT on payments
Option to take early settlement
No restriction on mileage
Back to Top

Finance Lease

The monthly rental in a Finance Lease is determined by the cost of the vehicle, the period and the estimated future value of the vehicle, which is based on the proposed annual mileage. A payment equivalent to the estimated future value is payable at the end of the contract. At the end of the contract period, the vehicle is sold and the proceeds returned to the lessee.

The key features of Finance Lease are:

No ownership of the vehicle
Flexible initial deposit
Up to 100% of monthly payments offset against profits-for businesses
Low monthly payments
VAT on payments
Option to take early settlement
No restriction on mileage
Back to Top

Outright Purchase

You may decide that leasing is not for you as you prefer to own your vehicle outright. If that’s the case please contact us as we are able to sell vehicles at a very competitive price outright. Whether it is a new, used or imported vehicle we can offer vehicles for outright purchase.

Hire Purchase / Lease Purchase / Finance Lease / Outright Purchase / Contract Hire
Personal Contract Hire / Contract Purchase / Personal Contract Purchase

For more information on Hire Purchase and Finance Lease please contact the AMT sales team on 0844 8262300 or e-mail us your enquiry at enquiries@amtleasing.co.uk.