HP Car Finance UK: Choosing The Right Car Leasing Option

by Aria Akachi Writer & Web marketing consultant

For both the businesses and for the general public it is well documented that car leasing can be financially beneficial and it is easy to get bogged down with all the different options which are available to you such as the HP car finance UK.

To cut through the jargon and offer you the reasonable tips for choosing the correct car leasing or contract hire deal for you or your company is what we intend to do today.

Choosing Hire Contract

Whether you are a sole trader, a limited company or a partnership, contract hire or hire purchase car finance is a vehicle leasing contract that is incredibly versatile.

You will only pay a fixed rental on a month by month basis and usually included in the packages in the service and the repair of the vehicle that you have chosen and this is the greatest advantage in hire contract.

There are two types of HP car finance UK:

1. Under circumstances, the goods are purchased from the dealer by the financier and

The hire-purchase agreement is obtained by the financier from the customer.
The customer becomes the owner of the goods under this.
With the payment of a nominal price, goods are purchased on payment of all the installments of the stipulated hire and exercising his option.
To recover the cost from the customer the owner gets his money from the financier.

2. In the other type:

The customer executes a hire-purchase agreement with a financier as the customer purchases the goods.
Subject to the payment of the amount paid by the financier on his behalf to the owner he remains in possession of goods.
To seize the goods in the event of non-fulfillment of conditions of the hire-purchase agreement by the customer the financier has got this right.

When you make your initial inquiries about the vehicle lease, there are other options too which are available as there are initial types of vehicle or car leasing which you will want to look into:

Non Status Contacts or Sub Prime Contracts
Lease Purchase
Hire Purchase

To finance buying a new or used car hire purchase is a way. With the loan secured against the car, you pay a deposit and pay off the value of the car in monthly installments. You will not own the vehicle until the last payment is made is what it means.

How do hire purchase used cars work?

You first need to put down a deposit on the car which you want to buy in most situations. This is counted to be of being 10% or more than that of the value of the vehicle.

Over a period of 12 to 60 months, the rest of the value of the car will then be paid off in installments when you go for hire purchase used cars.

Even the brokers also offer this service through hire purchase is usually arranged by the car dealer. For the used cars the rates are less through these rates are often very competitive for the new cars.

The annual percentage rate can vary from 4%-8% for second-hand cars. It is better when the numbers are lower. As you do not have a good credit score, the rates could be higher.

You will not be able to own the car until you have cleared the last payment including the option to purchase free as the loan is secured against the car.

Before signing the contract you need to make sure that you can understand the terms and conditions of your loan. You will be able to own the car once all the repayments have been made and you pay a final fee which is known as the ‘Option to Purchase’.