Hire purchase | Lombard

Hire-Purchase-Explanation

Hire purchase

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Security may be required. Product fees may apply. Specific criteria applies.

Finance is only available for business purposes.

What is hire purchase?

Hire purchase (or lease purchase) lets you spread the purchase cost of an asset, like a business car or business equipment,  over a longer period with fixed regular payments. It can be flexed  to suit your business and we offer flexibility on the cost of your deposit, fixed payments and the final lump sum. 

What is the difference between hire purchase and leasing?

When deciding what is right for you and your business, it’s important to know the basic difference between hire purchase and leasing. They are both good  ways of financing assets like cars and vans.

Leasing is a method of financing that allows you to use an asset over an agreed term and return it at the end. With Contract Hire there is a residual value placed on the vehicle which reduces the lease rentals you pay. Not having to dispose of assets at the end of the agreement can save both time and effort.

Hire purchase is a flexible way of financing an asset when would like the option of keeping the asset at the end. After you’ve completed the last payment, you can become the owner of the equipment.

 

Why choose hire purchase?
Flexible repayments

You can choose to reduce your monthly payments by paying a larger sum at the end (known as a Balloon Payment).

Reduce tax payments

Writing down allowances and capital grants may be claimable on your agreement. You may also be able to offset repayment interest against your profits and reclaim VAT (rules apply).

Stay in control

Your business may be able to offset the interest charges against trading profit and you have the option of owning the asset at the end.

Choice of interest rates

We offer a choice between fixed or variable interest rates – just pick whichever suits you best.

Customers may be responsible for any maintenance or repairs due on their asset. Contact us or see your contract terms for more details.

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Hire Purchase

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