How Hire Purchase Works

How Hire Purchase Works

Purchasing a new car – be that brand new from a main dealer or second hand – is one of the biggest expenses you are likely to make but can also be one of the most confusing.

That’s because of the various different ways in which you can look to finance the purchase, ranging from an outright cash deal to Contract Hire, or Hire Purchase.

Aside from an outright cash deal, arguably the most popular form of car finance is Hire Purchase, which provides the opportunity to own the car at the end of your finance deal and avoids the mileage limitations that can often be found on a Contract Hire agreement.

A Hire Purchase agreement can be structured in a variety of ways, with the team here at Find Me Car Finance being specialists in helping to secure you the best deal possible from our panel of lenders and broker.

In simple terms, a Hire Purchase deal involves putting down a deposit (however, some lenders now also offer a no deposit option) on the car of your choice with the remainder of the purchase price then being paid off in a series of installments across an agreed period of time. 

Unlike some other deals, HP removes the need for a lump sum payment at the end of the agreement, although it should be noted that you won’t own the car until the final payment on it has been made.

The way in which a HP deal is structured means they can be suitable for a range of different people, with the option to pay a larger deposit on the car thereby reducing the amount of finance required and the resultant monthly payments.

Those with less or no money to put down at the start of the deal could instead seek to increase the amount of finance, with the car acting as collateral against the loan.

The fixed nature of payments mean you’ll always know how much you are paying on a monthly basis, and makes it easier to see exactly how much your finance deal is costing.

You may also be able to return a car early on a HP deal once you have paid more than half of the cost, something our expert team will be happy to explain to you in full.

Sandhurst Associates Limited is a FCA-authorised credit broker, not a lender

Representative 22.4% APR.


We work exclusively with a selected group of lenders and brokers to offer you a range of credit and loan products. We may receive commission from lenders or brokers for introducing you to them or when you complete your application with them. You can request details of these commissions or fees, by emailing us. We will then provide you with the precise amount of the commission. Please note the broker we direct you to may not offer the cheapest loan that is available to meet your needs due to the panel of lenders they work with and/or have integrated with.

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Find Me Car Finance is a trading site of Sandhurst Associates Limited (Sandhurst).

Sandhurst is registered as a limited company in England and Wales
with company number 06958589.

Registered Office: The Granary, 50 Barton Road,
Worsley, Greater Manchester, M28 2EB.

Sandhurst is authorised and regulated by the Financial Conduct Authority and is entered on the Financial Services Register under reference number 723591.

It is also registered under the Data Protection Act 1998 under registration number Z2032925 and a member of the CFA and CSA.

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Support via email is available by clicking here.

Your vehicle may be repossessed if you do not keep up the repayments.

We work exclusively with a selected group of lenders and brokers to offer you a range of credit and loan products. We may receive commission from lenders or brokers for introducing you to them or when you complete your application with them.

You can request details of these commissions or fees, by emailing us. We will then provide you with the precise amount of the commission. Please note the broker we direct you to may not offer the cheapest loan that is available to meet your needs due to the panel of lenders they work with and/or have integrated with.

The guidance contained within this website is subject to the UK regulatory regime and is therefore targeted at consumers based in the UK only.

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