Check if you're eligible forHire Purchase

The best car finance option if you want to own a car.

Hire Purchase at Stoneacre

What is a Hire Purchase (HP) agreement?

Hire Purchase is the best car finance option if you’re 100% committed to owning your car.

How does Hire Purchase work?

Unlike a popular PCP finance deal, Hire Purchase finance guarantees you full ownership of the car at the end of your agreement. The size of the deposit or part-exchange will affect the monthly amount that you pay. For example, a larger deposit or part-exchange will reduce the monthly amount considerably. You’ll pay more interest on longer agreements, but the monthly payment will be smaller; the opposite applies to shorter contracts.

Check out our helpful video that explains HP car finance in further detail.


Representative Example

Cash Price£16,551.73
Deposit£1,578.78
Term49 months
Payment£367.83
Amount of credit£14,972.95
Fixed Interest4.99%
Representative APR10.62%
Total Charge for credit£3,449.86
Option fee (included in total charge for credit)£399.00
Total Amount Payable (Incl. Deposit)£20,001.59

We are a credit broker and a lender. We can introduce you to a limited number of lenders and their finance products. We will provide details of products available, but no advice or recommendation will be made. You must decide whether the finance product is right for you. We do not charge you a fee for our services. Lenders may pay commission to us (either a fixed fee or a fixed percentage of the amount you borrow) for introducing you to them, this may be calculated in reference to a variable factor such as (but not limited to) the vehicle age, your credit score and the amount you are borrowing. Different lenders may pay different commissions for such introductions.

Hire Purchase explained:

Hire Purchase Monthly Payments

Hire Purchase is a car finance contract that is used for both new and used cars. These agreements start with a deposit (or a part-exchange); a term is then agreed for monthly payments, usually lasting between 36-60 months. The monthly HP finance payments are fixed by the interest rate set at the beginning of your agreement, while the final payment of a contract can often be more than that of the typical monthly payment.

An example of a Hire Purchase agreement:

Cash Price - £5,995; Deposit - £250; Monthly Payment - £132.82; Amount to Finance - £5,745; Interest - £2,523.20; Final Payment - £431.82; Total Amount Payable - £8,518.20; APR - 15.9%; Fixed Rate - 7.74%; Term - 60 Months


Hire Purchase Cars

Check out our second-hand cars on HP finance today. Whether you’re after Audi or Mercedes-Benz, we’ve got it covered and have the best deals for you. Discover a range of world-renowned manufacturers and second-hand cars.

Hire Purchase Advantages and Disadvantages

Before selecting Hire Purchase as your finance deal, you should weigh up the pros and cons and make sure it is the best car finance deal for your needs. Below we outline some of the common Hire Purchase (HP) advantages and disadvantages...

  • Hire purchase is a simple way of financing and relatively easy to obtain.
  • The rate of interest and monthly payments are fixed in place, allowing you to plan effectively for your finances during the contract.
  • No mileage restrictions or paying for damage as is the case with PCP finance.
  • You will take full ownership of the car once all the payments have been made and the contract has finished.
  • You can spread the cost with Hire Purchase over a few years as opposed to paying for it in full.
  • You won't own the car until all the car payments have been made.
  • If your financial situation changes and you can't afford the monthly payments, your car may be repossessed.
  • Monthly payments are higher compared to PCP and PCH packages since you're paying for the full sum of the car.
  • You'll need to be aware of the effects of depreciation and the decline in the car's value over time.
  • If the car is destroyed in an accident or stolen and your insurer doesn't cover the full cost, you'll still need to pay for the car finance.
  • Advantages of Hire Purchase
    • Hire purchase is a simple way of financing and relatively easy to obtain.
    • The rate of interest and monthly payments are fixed in place, allowing you to plan effectively for your finances during the contract.
    • No mileage restrictions or paying for damage as is the case with PCP finance.
    • You will take full ownership of the car once all the payments have been made and the contract has finished.
    • You can spread the cost with Hire Purchase over a few years as opposed to paying for it in full.
  • Disadvantages of Hire Purchase
    • You won't own the car until all the car payments have been made.
    • If your financial situation changes and you can't afford the monthly payments, your car may be repossessed.
    • Monthly payments are higher compared to PCP and PCH packages since you're paying for the full sum of the car.
    • You'll need to be aware of the effects of depreciation and the decline in the car's value over time.
    • If the car is destroyed in an accident or stolen and your insurer doesn't cover the full cost, you'll still need to pay for the car finance.

Hire Purchase FAQ

What's the difference between hire purchase and leasing?

With Hire Purchase, you'll own a car at the end of the contract, provided that all payments have been made. Meanwhile, with leasing, you're essentially hiring a car and then handing it back to the dealer or leasing a new one once the contract is up. Hire Purchase cars are more expensive to finance since you're paying the full price of a vehicle, as opposed to leasing. 


Can I get hire purchase with bad credit?

Even if you have a bad or poor credit score, it's possible to get car finance. We work with a panel of lenders who specialise in bad credit car finance, so getting your dream car on Hire Purchase shouldn't be an issue. Check out if you're eligible with our quick & easy finance form


How to get the best hire purchase deal?

You can do a few things to ensure the best Hire Purchase deal. Before applying for HP finance, check your credit score & history. If the score is lower than expected, you can try to raise it by fixing problems on your credit report and registering on the electoral roll. For more tips on how to boost your credit score, check out our handy infographic. Additionally, you can put down a larger deposit so that the monthly payments are cheaper. 


What’s the difference between hire purchase and finance lease?

With the Hire Purchase, the intent is to purchase it at the end and the higher monthly payment reflects this. Finance leasing is mainly used by businesses to rent a car as it works out cheaper. 


How can I get a hire purchase deal?

To get Hire Purchase (HP) finance, you’ll first need to go through a soft credit check with us. After only a few minutes, you’ll find out whether you’re eligible for auto financing. If you’ve been approved, then our friendly finance team will be in touch. We will discuss your requirements and select the best car finance lenders for your circumstances. 


What if I can’t afford my HP repayments?

There are a few options to choose from if you can’t afford to pay for monthly HP finance. Firstly, you should contact your lendersand try and work out a deal. If you don’t take action, your car may be repossessed, and your credit score will suffer as well.


Refinancing the car

You can usually switch to cheaper finance by getting a less expensive car. However, you’ll need to repay the remaining balance on your current car, plus the monthly payments on your new deal. This option may not be for everybody, but the most common action, unfortunately, is handing back the vehicle to the dealer.

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