HP stands for Hire Purchase, and this is one of the main types of car finance agreement. With HP finance you will essentially hire the car from the lender, making repayments every month until the amount you borrowed is paid in full. At the end of the agreement, ownership of the vehicle will be transferred to you.

Pros:

• Payments are fixed throughout the contract term
• The vehicle will become yours at the end of the agreement to keep or sell on
• There are no mileage restrictions with HP finance
• After your initial deposit, there will be no lump sums to pay

Cons:

• Hire purchase instalments are higher than other types of finance because they will contribute to the full price of the vehicle
• Failure to keep up with the repayments could lead to the car being repossessed as the loan will be secured against the vehicle

With HP finance, you will put down an initial deposit which will cover a small portion of the whole vehicle price. The amount that remains will be divided by the number of months in your agreement, giving you the cost of each monthly instalment. You will then make these repayments until your agreement is over and you have paid back the value of the car in full along with any interest. At this point, you will become the legal owner of the vehicle.

Apply for car finance in Ringwood with Economy Hire by completing our online application form!