As the name suggests Hire Purchase (also known as HP) is simplest way for individuals to purchase a car.

Hire Purchase is based on a fixed term contract where customers pay an initial deposit followed by fixed monthly payments. The vehicle is owned by the HP finance company until the final payment is paid.


  • Initial deposit
  • Fixed term contract between 12 and 60 months
  • No mileage restrictions
  • Even though you have not paid for the vehicle in full, you are still allowed to drive it.
  • At the end of your contract the vehicle is yours
  • Option of including maintenance with the contract
  • No Vat to pay on monthly instalments compared to Lease agreements


  • Vehicle could depreciate over time
  • Early termination can be expensive
  • The finance company are legal owners of the vehicle until the final payment is paid.
  • You must have fully comprehensive vehicle insurance
  • You will never own the vehicle



This funding method benefits customers wishing to own the vehicle at the end of the contract. Contracts are usually taken over two, three, four or five years, providing a high level of flexibility. The initial deposit is typically 10% of the vehicle value and needs to be paid before the start of the contract.

Hire Purchase does not limit a driver to specific annual mileage as per Contract Hire agreements and the driver is free to travel as often as he or she likes without excess mileage costs to worry about.