How does it work?
Lease Purchase is similar to a Personal Contract Purchase (PCP) - you can keep your monthly payments lower by deferring a significant proportion of the amount of credit to the final payment at the end of the agreement but do not have the option to return the vehicle to the Finance company at the end of the agreement.
Agree an initial deposit and how long you want the agreement to run for and the dealer will then calculate your final payment and confirm your regular monthly payment. The dealer will submit the finance application to us and subject to your application being approved, you can just drive your car away.
The options are:
(1) pay the Final Lump Sum Payment to own the vehicle or
(2) part exchange the vehicle subject to settlement of your existing
finance agreement; new finance agreements are subject to status.
Lease Purchase is often used by customers and limited companies who don’t want to be bound by mileage restrictions. Lease purchase is only available to limited companies on a non regulated basis.
- You like to drive the newest model.
- You want to keep your monthly payments lower.
- You don’t want to be subject to excess mileage clauses.
- No Mileage Restrictions.
- Lower payments means you might be able to afford a newer car
However, the following must also be considered.
- A significant proportion of the credit is deferred until the end of the contract so you should prepare for this.
- Your vehicle is at risk of repossession if you do not maintain contractual repayments.
- You do not own the vehicle until the final payment including interest has been made.