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Hire Purchase
The advantages & disadvantages of hire purchase
Need some help?
Hire Purchase
The advantages & disadvantages of hire purchase
Hire Purchase (HP) is a simple way for you to purchase a new or used vehicle with fixed monthly payments.
Usually customers take out a Hire Purchase agreement over 2 – 5 years. The monthly payments that you make on your Hire Purchase Agreement is stipulated by the initial payment that you place on the vehicle, the term and the interest rate.
At the end of the agreement, subject to all payments being made (including option to purchase fee, set out within your finance agreement) the title of the vehicle will be transferred over to you and you will become the legal owner.
advantages
- small or no deposit
- fixed repayments to help with budgeting
- fixed interest rates
- secured against the vehicle, not you!
- 2-7 year terms to meet your budget
- no mileage restrictions
disadvantages
- the loan is secured against the vehicle. if you miss payments the vehicle may be repossessed.
- It is typically more expensive than a PCP agreement as you financing the full value of the vehicle instead of a proportion.
- Missing any payments could affect your credit score.
Car Finance That Takes You Places.
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Get In Touch
Unit H14, Link 49, Boscombe Business Park, Gloucestershire, BS107SB
- Email: [email protected]
- Phone: 0117 235 8727
- Hours: Mon-Fri 9:00AM - 5:00PM
- Saturday 10:00AM - 2:00PM
- Sunday Closed
Car Finance That Takes You Places.
Long Barn 2, Folly Farm, Tickenham, Clevedon, BS21 6RY
- Email: [email protected]
- Phone: 0117 235 8727
- Hours: Mon-Fri 9:00AM - 5:00PM
- Saturday 10:00AM - 2:00PM
- Sunday Closed
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Low Rate Car Finance Limited is authorised and regulated by the Financial Conduct Authority (FRN: 963856). We act as a credit broker not a lender. We can introduce you to a limited number of lenders who may be able to offer you finance facilities for your purchase. We will only introduce you to these lenders. We may receive a commission payment from the finance or hire provider if you decide to enter into an agreement with them. The nature of this commission is as follows: a fixed fee or a percentage of the amount financed. You can request for us to disclose the amount of any commission received. You may be able to obtain finance for your purchase from other lenders and you are encouraged to seek alternative quotations. If you would like to know how we handle complaints, please ask for a copy of our complaints handling process. You can also find information about referring a complaint to the Financial Ombudsman Service (FOS) at financial-ombudsman.org.uk.
“Where and when we need your consent" - There will be circumstances where we will only process your data if we have your consent to do so. For example, if you provide us with data that is classed as a special category of data such as health information, criminal records of convictions and offences, or allegations of criminal offences. We will only process this with your permission (unless we feel the processing is necessary to protect your vital interests or if the law allows us to do so). You have a right at any time to ask us to stop the processing of that specific data”.
Car Finance That Takes You Places.
Services
Quick Links
Get In Touch
Long Barn 2, Folly Farm, Tickenham, Clevedon, BS21 6RY
- Email: [email protected]
- Phone: 0117 235 8727
- Hours: Mon-Fri 9:00AM - 5:00PM
- Saturday 10:00AM - 2:00PM
- Sunday Closed
© 2025 All Rights Reserved.
Low Rate Car Finance Limited is authorised and regulated by the Financial Conduct Authority (FRN: 963856).
We act as a credit broker not a lender. LowRateCarFinance Limited will receive a commission payment from the finance or hire provider if you decide to enter into an agreement with them. The nature of this commission is as follows: we either receive a fixed fee commission per finance agreement entered into or we receive a commission based on a percentage of the total amount of finance taken by the customer. The lenders we work with consider that the commission earned reflects the work carried out by us as the broker. This includes advertising the finance option, coordinating with the lender to arrange financing, and handling administrative tasks such as completing proposals, processing orders, and managing delivery. Commissions help cover these operational costs, allowing brokers to provide their services without direct fees to customers. The commission we receive may be pre-set but can vary between different rates and the commission values could vary between finance products, but the commission we receive does not influence the interest rate you will pay. I have been advised about the amount of commission that will be received and am happy to proceed. You may be able to obtain finance for your purchase from other lenders and you are encouraged to seek alternative quotations.
If you would like to know how we handle complaints, please ask for a copy of our complaints handling process.
You can also find information about referring a complaint to the Financial Ombudsman Service (FOS) at financial-ombudsman.org.uk.
“Where and when we need your consent" - There will be circumstances where we will only process your data if we have your consent to do so. For example, if you provide us with data that is classed as a special category of data such as health information, criminal records of convictions and offences, or allegations of criminal offences. We will only process this with your permission (unless we feel the processing is necessary to protect your vital interests or if the law allows us to do so). You have a right at any time to ask us to stop the processing of that specific data”.