Hire Purchase calculator

Cost of Vehicle
£50,000.00
£5k £200k
Deposit
£10,000.00
£100 £190k
Term
48 months
12 60
Your Summary
If you borrow over your monthly payments will be and total amount payable will be with a Representative APR of
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The representative example is based on excellent credit. Please note that this calculator is for illustrative purposes only. If you require a more accurate quote, please contact us. Credit is subject to status, UK residents aged 18+ only. Average Document Fee of £150 and an Option to Purchase Fee of £100 are included in the total balance. The rate is subject to change and the Representative APR may not be the rate you’ll receive. We’ll offer you a rate based on our assessment of your personal financial circumstances. The APR is a fixed rate. Charles and Dean Ltd. is a member of the National Association of Commercial Finance Brokers and is authorised and regulated by the Financial Conduct Authority. Charles and Dean Limited is a credit broker and not a lender. Charles and Dean Limited operates with a panel of lenders from whom we may be paid a commission

Your finance options

Hire purchase is one of the most popular types of finance around. With Hire Purchase agreements, as the registered keeper of the car, you are responsible for the licensing and any use of the vehicle. However, the finance company remains the legal owner until the amount borrowed has been fully repaid.⠀

You will pay a small acceptance fee and option-to-purchase fee as part of the agreement. Once all the payments have been made, the car becomes yours.

Reasons to choose Hire Purchase:

 You will gain full ownership of the car at the end of the agreement
✓ 
There is a greater chance of credit approval
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A low deposit is required, typically 10% of the cost of the car
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It’s easy to budget with flexible repayment terms and fixed interest rates
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There is more flexibility for you to make early repayments, over payments, or to make a ‘balloon payment’ to pay off the remainder of the loan in full

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A Personal Contract Purchase is a variation of a Hire Purchase (HP) agreement. The key difference with a PCP agreement is that your car’s Guaranteed Minimum Future Value (GMFV) is calculated at the beginning of the agreement, and this value is deferred.⠀

The deferred sum is guaranteed not to fluctuate under normal circumstances. A number of factors are taken into consideration to calculate the deferred sum, including the age of the car and the expected mileage of the car at the end of the agreement.⠀

Deferring the GMFV to the end of the agreement means that monthly payments will be lower than those for a comparable HP agreement over the same term. A PCP agreement gives you the flexibility to decide whether you would like to own the car outright at the end of the agreement by paying the deferred value (GMFV).

If you decide not to pay the deferred value at the end of the agreement, you can sell the vehicle privately and use the money towards settling the balloon payment, or you can just return the car to the lender.

Reasons to choose Personal Contract Purchase:

✓ The monthly repayments are typically lower than Hire Purchase
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You can return the car at the end of the agreement – using the equity towards a new model
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A low deposit is required, typically 10% of the cost of the car
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It’s easy to budget with flexible repayment terms and fixed interest rates
✓ 
You have the option to own the car at the end of the agreement, by making a ‘balloon payment’ to pay off the remainder of the loan

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A lease purchase is similar to a rental agreement, however at the end of the term you will own the car. The difference between a lease purchase and a PCP agreement is that the deferred sum (referred to as a Guaranteed Minimum Future Value (GMFV) in a PCP deal) must be paid on a lease purchase agreement whereas on a PCP, it’s optional.

With a lease purchase you cannot return your car at the end of the agreement. The deferred sum must be paid. The deferred sum is calculated by the future resale value of the car. You can pay the deferred sum through a refinance agreement if you wish. You can fully or partially settle any outstanding payments at any point during the financial term. A typical lease purchase agreement will last between two and four years.

Reasons to choose Lease Purchase:

✓ A lease purchase is a good option if you’re looking to finance a more expensive or a premium car
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A lease purchase can be a good option if you would like lower monthly repayments. This is because advance payments are generally paid at the start of the agreement and there is a balloon payment at the end of the term. You can also decide on the length of the financial agreement

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Contract Hire is a popular form of vehicle leasing. Contract hire means you take control of a car for a fixed period. You never take ownership of the car. At the end of the contract you return the car to the contract hire company.

Your payments will be determined using a combination of the retail price of the car and the residual value of the car. Your payments is a calculated using your mileage, the condition of the car and depreciation to agree monthly payments.  Contract hire is a good option if you would like to agree a maintenance package, such as car insurance and tyres. You will also know exactly what you need to pay and when and there is no surprise costs at the end of the term. There is no option to buy the car at the end of the agreement.

Reasons to choose Contract Hire:

✓ If you would like the option of driving a new vehicle every few years, contract hire is a good option for you
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Contract Hire is also a good option for businesses as it allows you to update fleets regularly with the latest vehicles, avoid large down-payments and adjust fleet size based on the number of employees

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