- HIRE PURCHASE (HP). A hiring agreement between a customer and a finance company secured against the vehicle, where the customer has the option to own the vehicle at some point during or after the agreement. The finance company HIRES the vehicle to the customer for an agreed period of time at an agreed monthly sum. The customer can gain ownership (title to the car) by paying an additional sum called the Option to Purchase Fee. The customer must, however, have paid everything else off to get title to the vehicle.
- CONDITIONAL SALE (CS). Conditional Sale agreements are very similar to HP, but they are different products. The key difference is that in entering a Conditional Sale agreement the customer commits to becoming the legal owner of the vehicle, once all the repayments have been made to the lender. Under HP, the customer has a genuine choice on whether to take legal title at the end.
- LEASE PURCHASE (LP) Like an HP or CS agreement, but with a payment structure that is similar to a lease, where instead of a deposit being paid, a customer may be required to make "advance payments". This means regular repayments are made "up front" by the customer. A balloon payment at the end of the Lease Purchase may also be included.
- FINANCE LEASE (FL). A form of flexible leasing to fund the use, but not the ownership, of a vehicle and is ideally suited for VAT registered businesses. The leasing co. (lessor) hires the vehicle to the customer (lessee) for an agreed period of time (the primary period of hire) for an agreed monthy sum.
- PERSONAL CONTRACT PURCHASE (PCP). Different from HP because of it's payment profile and structure. The customer's repayments are determined by the size of the deposit, the predicted mileage and the length of the agreement. A predicted minimum future value (balloon payment) is offset until the end of the agreement - this is called the Guaranteed Minimum Future Value (GMFV). This allows the customer to know the least amount the guarantee will be worth at a point in the future.
- PERSONAL LOANS (PL). An unsecured lending facility that can be used for almost any purpose such as home improvements or to buy a car. The customer will immediately take title / ownership of the vehicle. Some lenders offer a "restricted-use" personal loan agreement - this is one where the loan must be used by the customer to buy a motor vehicle.
- DRIVER to DRIVER (Private vendor). The finance of vehicles being sold by Taxi and Private Hire drivers and fleets.
- RE-FINANCE. Raising funds from the equity in existing vehicles to aid cashflow.
These are just a selection of the most commonly used products for our business sector. Please contact us for a fuller explanation of each product, or if you have any queries.