HP Car Finance To Suit You

Rates from 10.9% APR. Representative APR 19.9%

Audi A1
CAR FINANCE SOLUTIONS

HP Car Finance.

Before we get into HP finance, it is important to understand this type of car loan agreement and how it works. 

Hire Purchase (HP) car finance allows you to hire the vehicle until you have completed all repayments. Deposits are typically around 10%. Repayments are spread across the duration of the finance deal. When you have made all your repayments, the car belongs to you. Until then, the finance company owns the car.

These contracts normally last between one and five years.

Once your HP car finance agreement has been fully paid to the lender, you will be able to own the car. That’s because typically, at the end of the agreement, you use car financing to purchase a car. Although, you should be aware that there may be an additional option to purchase fee, should you wish to purchase the car.

Advantages of HP Car Finance.

  • For starters, because of the agreement’s simplicity. It is easy to understand and budget for.
  • Second, you will be able to purchase a more expensive car than you would have if you paid cash upfront.
  • When compared to other types of car loans, HP car finance options are easier to secure.
  • When the contract expires, you will have the opportunity to purchase the vehicle.
  • There are both low and no deposit alternatives available.
  • It is a great option for those with good credit scores
  • APR is quite low for people with good credit.
  • Bright Motor Finance exclusively deals with FCA-regulated dealers, so when you pick HP car finance from us, you know you’re in good hands.

Disadvantages of HP Car Finance.

  • Your car may be repossessed if you do not keep up with the monthly payments.
  • Your monthly payments may be greater than with other types of car financing, such as PCP car financing.
  • You do not own the vehicle until you make the final payment.
  • Without prior approval, the car may not have any alterations.
  •  

Other Car Finance Options.

If Hire Purchase does not seem to be the best choice for you, there are several additional options. Personal Contract Purchase (PCP). Being the most widely used option.

You can use this sort of auto financing to buy a new or used car. This is because, as the loan is secured by the vehicle, you will normally be required to pay a deposit of 10% of the car’s worth. And then pay off the balance in monthly installments. Despite the fact that both vehicle dealerships and brokers can arrange a hire purchase loan. 

Some good things about HP car finance deals.

To begin, you will have a flexible payment period ranging from one to five years, depending on your financial situation. However, keep in mind that the longer the duration, the more interest you will have to pay.

There is no deposit necessary and once you have paid off half of the value of the car, you have the option to return the car. You won’t have to commit to any monthly payments.

They also usually do not come with any mileage restrictions.

HP Car Finance
Payment History
35%
Amount You Owe
30%
Length of Credit History
15%
New Credit Opened
10%
Type of Credit
10%

Credit Score Breakdown.

What Factors Affect Your Credit Score?

Financial well-being is strongly influenced by people’s credit scores. Your credit score is a measure of your financial responsibility. The higher your credit score, the better your chances of getting car finance with lower interest rates, and other benefits. Having a low credit score may prevent you from qualifying for a car loan that you may want, or your interest rate for borrowing will be higher than those who have excellent or good credit.

If you seek advice on how to improve your credit score or simply require more information, please visit: Ultimate Guide to Credit Scores

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Rates from 10.9% APR. Representative APR 19.9% Representative Example: Borrow £6,000 with £1,000 deposit over 48 months with a representative APR of 19.9%, the monthly payment would be £182.26, with a total cost of credit of £2,748.61 and a total amount payable of £8,748.61. Car Loans UK is a broker not a lender. This is an example only, all finance subject to status. Lender fees may apply

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Once we have dotted the I’s and crossed the T’s, we will handle the rest of the paperwork for you so it’s a nice and easy process. You’ll be on the road in no time!

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Rates from 10.9% APR. Representative APR 19.9%

Frequently Asked Questions.

Why use Bright Motor Finance for motor finance?

At Bright Motor Finance we have many lenders on our panel, so we can make sure you are getting the best motor finance deal for you. Plus, we do all the admin, paperwork and negotiations with the dealer.

What is the difference between HP & PCP?

HP and PCP car finance are fairly similar to one another. However PCP tends to have lower monthly repayments. Although that the full amount that will need to be repaid is generally higher than with hire purchase.

PCP works by having a loan for the difference of the vehicles price when it is brand new, and the anticipated vehicle value when the agreement has been completed. This is because the vehicle will of course, depreciate over time.

HP works by usually paying a deposit of around 10% of the cars initial value, and then this value will be paid off in fixed monthly instalments. Car dealers as well as brokers (such as ourselves) can arrange a hire purchase finance agreement.

What is a car finance brokerage service?

In essence, a car finance broker acts as a middleman between the customer and the lender. A car loan broker handles all the paperwork and negotiates with lenders on your behalf. By doing this, you can rest assured that the broker is fighting for you to get you the best deal. Our goal is to make your car finance journey as simple as possible. As well as this, car finance brokers such as ourselves have deals that aren’t usually available to the general public. Instead of charging the customer, car finance brokers charge the dealerships.

What if I have been refused by other brokers?

There is still hope even if other brokers have rejected you in the past. We offer a number of finance options for those with bad credit scores at Bright Motor Finance. We will conduct a hard credit check when you apply for car finance through us, which may negatively affect your credit score. Especially if they were conducted within a short period of time. As a result, it is recommended that you wait between 3-6 months before applying for car finance again after being declined.

What if I’m struggling to make payments?

Having trouble making your car finance payments? You have a number of options available to you. One of the following charities/organizations can provide you with free, independent advice. 

Can I change my mileage on PCP contracts?

In a nutshell, the answer is no.

This is because the car’s resale value has already been calculated once you’ve signed your PCP car loan contract. It is crucial to know that exceeding your agreed-upon mileage allowance will result in additional penalties at the end of your PCP contract.

How does car finance affect my credit score?

Initially, asking for a car loan will typically have a negative impact on your credit score due to the intensive credit checks that lenders will perform. You should be aware, however, that if you make your car finance instalments on schedule. This will almost certainly improve your credit score.

What is APR?

The annual percentage rate (APR) is the total amount charged for the loan. APR, on the other hand, comes in two varieties. Exact APR implies that the rate displayed to you is the rate you will receive. Representative APR, on the other hand, suggests that 51 percent or more of those who apply for financing will receive that rate. This means that customers with weak credit may face a higher APR.

Representative APR is commonly used to advertise a company’s rates. After you have provided the lender with all of the essential information, they will be able to provide you with your specific APR rate.

GAP insurance and do you need it?

What exactly is it?

Gap insurance is an abbreviation for Guaranteed Asset Protection.

Gap insurance is a type of insurance that is meant to cover the difference between the amount your insurance provider pays out in the event that your car is written off or stolen and the price you paid for the vehicle. However, you should be aware that gap insurance supplements, not replaces, your usual car insurance.

So, when do you need gap insurance?

Gap insurance can be beneficial in a variety of ways. First and foremost, if you took out a large loan to purchase your car. As previously said, gap insurance would be advantageous if your automobile was stolen or written off. This is due to the fact that the gap will pay off the existing debt.
Furthermore, gap insurance may be advantageous if you are concerned about the depreciation of your vehicle. In the first year, a brand new car will lose 15-35 percent of its value. As a result, gap insurance might assist you in receiving a larger reimbursement if your automobile is written off after it has already depreciated.

Where can I purchase gap insurance?

Thanks to Bright Compare, comparing gap insurance quotes has never been easier!

What Happens If There Is An Issue With The Vehicle?

If the vehicle is defective upon delivery, you can simply refuse it and return it to the dealership.

Can I alter my car if I finance it?

You can, but you must first obtain authorisation from the financial firm before making any changes.

Is there anything to consider?

Yes.

  • You will not own the car until you make the final payment.

  • You are also not permitted to sell or modify the vehicle in any manner without receiving permission first.

  • Third, monthly repayments are typically higher when compared to PCP and other car leasing plans.

  • Finally, it can be expensive if you only need a short-term arrangement

What affects the cost of my car finance payments?
  1. Your deposit size
  2. How long your car finance agreement will last
  3. The interest rate
  4. What car do you choose?
How do I know that HP car finance is right for me?

Ask yourself these questions:

Do I want to own the car outright?

Do I want to keep the same car for a while?

How far do I drive on a monthly basis? Is it far?

How good is my credit score?

How much can I spend?