Hire Purcahse (HP)


What Is It?
Hire Purchase is one of the most common motor finance products in the market. HP allows you to use the car while paying for it, at the end of the agreement you take ownership. The car is the security for the agreement. You will have an option to own the car at the end of the agreement term for an additional sum called the Option to Purchase Fee.

Lease Purchase (LP)


What Is It?
Lease Purchase loans are an unsecured lending facility that can be used for almost any purpose such as home improvements or to buy a car. A Lease Purchase loan is normally a fixed cost, fixed period loan of money to purchase any item the customer wants – including vehicles. This gives customers an option to purchase any vehicle they want. The facility is widely offered by Banks, Building Societies, Direct Lenders and Finance
Companies.

Personal Contract Purchase (PCP)


What Is It?
This is very similar to PCH, again having payments over a set period of time and set mileage. The main difference with this agreement is the inclusion of a final balloon payment. This allows you to purchase the vehicle at a price agreed at the beginning of the term. This payment is called Guaranteed Minimum Future Value (GMFV) which means the minimum projected cost of the vehicle at the end of the agreed contract. A PCP can be settled by the customer at any time if they pay the balance outstanding, including the GMFV to the lender.At the end of the PCP agreement the customer has three options:
Part exchange for another car
Pay the final payment and keep the car
Return the car and walk away.