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Hire Purchase Car Finance

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  • PCP & HP plans
  • 60+ plans / 15+ lenders
  • All credit ratings
  • Flexible purchase options
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Hire Purchase (HP)

HP is a traditional way to fund sizeable purchases, such as a car or other vehicle. While the flexibility of a PCP plan may sound appealing you should keep in mind that with HP:

  • you will own the vehicle at the end of the contract without the need for any final payments
  • your credit history may be less of an issue
  • you may a wider choice of vehicles
  • you may not have restrictions placed on mileage

Get an overview of car finance and compare HP to PCP, the other main form of car finance.

finance-options-hp.png

Having made an initial deposit you make monthly repayments and when the final payment has been made you own the vehicle outright. The larger the deposit you make the smaller the monthly payments will be.

Summary

  • You will own the vehicle at the end of the contract - no extra payment
  • Deposit not always required
  • Poorer credit histories more readily catered for
  • Fewer restrictions on vehicles and mileage

HP plans through our partner Car Loans 4U

  • Higher approval rates than with personal loans
  • 15 lenders with over 60 products
  • Pay monthly over 1 – 5 years
  • Deposit not always required
  • Available for new & used cars
  • Can be used at dealer or for private sales
  • Cars up to 12 years old (depending on the lender)
  • Classic cars/bikes/vans/caravans/trucks eligible
  • Fixed payment throughout the agreement
  • Own the car outright after the final payment
  • Can ‘Voluntarily terminate’ the agreement after 50% of payments are made

Please note: this information is for guidance only. You should clarify the terms of the loan with the lender before entering into an agreement.

Hire Purchase vs Personal Contract Purchase

Video: HP vs PCP

HP & PCP - What's the difference?

What are these types of finance?

With HP you make the decision up-front that you want to own the vehicle. A PCP plan gives you the option to simply return the vehicle at the end of the contract, or if you decide you want to buy it then you simply make one final (balloon) payment. 

Hire Purchase (HP)

  • you're hiring the car while you make payments
  • you pay a deposit, make monthly payments and after you make the final payment you own the vehicle

Personal Contract Hire / Personal Contract Plan (PCP)

  • you lease the car for a fixed period (typically 2-3 years) and make regular payments. The size of your deposit will affect the monthly repayments you make.
  • while leasing the car you don't own the vehicle
  • at the end of your lease contract you can:
    • hand the vehicle back and no more costs are involved
    • part exchange the car for a new PCP deal
    • purchase the vehicle outright with one final "balloon payment" which you know in advance.
  • Going over a set mileage will incur extra costs
  • Some contracts include vehicle maintenance

more information about PCP

Video: PCP vs. HP

 

Representative Example

Loan Amount

£7500

Monthly Repayment

£231

Loan Term

48 mnths

Total Repayment

£11,084

Representative APR

22.7%

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