Lease Purchase is a Hire Purchase agreement, offering you the option to own the vehicle at the end of the agreement. It offers fixed repayments and fixed interest payable on the purchase price less the deposit. In addition, you have the ability to defer a proportion of the vehicles cost to a final balloon payment at the end of the agreement. This will result in lower monthly payments than Hire Purchase and could therefore improve your cash flow.
The benefits of Lease Purchase are:
- Simple and quick to put in place
- You retain ownership of the vehicle
- You are not tied to mileage restrictions
- You have fixed repayments and fixed interest to control your costs
- Same tax benefits as Hire Purchase noted above