Hire Purchase (HP) spreads the cost of a vehicle across an agreed term. You usually pay a deposit, make fixed monthly payments and become the owner after the final payment and any option-to-purchase fee.
How it works
- Choose a vehicle and agree the deposit, amount financed and term.
- The lender buys the vehicle and you repay the credit in fixed instalments.
- The vehicle remains the lender's property during the agreement.
- Ownership transfers after all required payments and fees are made.
What to check before you apply
- The total amount payable, not only the monthly figure.
- Whether the deposit and term leave room in your budget.
- Early settlement terms and any option-to-purchase fee.
- The risk of repossession if repayments are not maintained.
A realistic note
A lower monthly payment is not automatically a cheaper agreement. Compare APR, total payable, term, deposit and fees together.
Frequently asked questions
Can I settle HP early?
You can normally ask the lender for an early settlement figure and compare it with continuing the scheduled payments.
Can I sell the car during HP?
Not without the lender's permission because the lender owns it until the agreement is completed or settled.
Is HP guaranteed?
No. Approval and the rate offered depend on the lender's status and affordability assessment.
Important: We Do Car Finance is a credit-broking service operated by Sandhurst Associates Limited. We are not a lender. Finance is subject to status, affordability and lender criteria. Acceptance is never guaranteed.