If you choose to buy a vehicle under Hire Purchase (HP) you enter a contract where you would pay for the vehicle in parts. This is calculated by the value of the vehicle along with the interest added and divided into pre-determined amounts. It is different to at to a traditional loan, this is because you do not own the vehicle until the the loan has been paid off. The debt is secured against the vehicle, this means you are not allowed to sell it until the debt has been cleared.
This means you are borrowing money for the vehicle and the loan is secured against it. When you have paid all the finance owed, the car is yours.
Is it suitable Is it suitable for you? HP car finance would be a suitable option for you when you know you'll be keeping the vehicle for a while.
Personal Contract Purchase (PCP) is an increasingly popular choice for car finance. It offers the best in flexibility at the end of the agreement, together with low, fixed monthly payments.
PCP is perfect if you are opting out of your company car scheme. Your company car allowance can fund your monthly payments, but there is no company car tax to pay.
At the beginning of the agreement your car's guaranteed future value is calculated, based on an agreed mileage and age. This is deferred as a final 'balloon' payment.
With With PCP you don't have to commit to buying the car at the outset. You use it for an agreed period of time (24-48 months) and then decide at the end of this period what you would like to do. Choosing to pay for your vehicle this way often means you can drive a higher specification higher specification vehicle for a lower monthly payment.
You have four options:
Buy the car by paying an agreed minimum residual value Part-exchange the vehicle for another Sell the vehicle privately (settling the balloon) Or, subject to mileage and condition, return the car with nothing more to pay (e.g. if depreciation resulted in negative equity)
Using dealership finance, offers you the opportunity to get into your next new car quickly and often cheaper than conventional funding solutions.
At Pinetree Car Superstore we have trained finance specialists who pride themselves in offering outstanding customer service and assisting customers in finding the right funding solution to suit their budget and individual circumstances.
We provide competitive finance packages that can be tailored to you, easy to understand and free from jargon. Getting your finance approved with us is a quick process and all paperwork can be completed quickly on site.
Please see our finance video's which explain each of the finance options available.
To find out more on any of these car financing options or any other ways to buy a car, please do not hesitate to contact us today.