What is hire purchase?
When you acquire a van through a hire‑purchase formula, you pay a monthly instalment consisting of two parts:
- One part covers the rental of the vehicle, allowing you to use it immediately.
- The other part goes toward paying off the vehicle over time..
At the end of the agreement, you can become the owner of the vehicle by paying the final purchase amount. Hire purchase is therefore a form of instalment payment.
How does hire purchase work?
A hire‑purchase contract typically runs for around 24 or 48 months. At the start of the contract, a monthly amount is agreed upon together, taking into account a minimum budget. If you notice that you have more financial flexibility, you can choose to increase your monthly payment during the contract. You can also choose to lower it, as long as it does not fall below the agreed minimum.
The benefits of hire purchase
The benefits of hire purchase
