Lease Purchase
Lease Purchase can be applied to either a private individual or a business user. Lease Purchase is commonly confused with leasing which is a different product all together. It is an ideal way of funding a prestige vehicle for a low monthly payment, or indeed to fund a mini fleet if your company is not VAT registered. The term can range from 12 to 60 months with a fixed final payment at the end.
With a Lease Purchase agreement the rate is fixed at the beginning and will not change. The deposit can range from 0 to 40% of the total amount of finance. At the end of the term there is a final payment to be made, this is commonly know as a "balloon payment", this is the anticipated value of the vehicle that was given at the beginning of the agreement. You can either pay the residual value and own the vehicle outright or pay the outstanding balance and use the balance as a deposit.
These agreements also allow for the company to acquire ownership when all payments including the optional "Balloon" payments have been made. The disposal and residual value risks remain with you.
- Low Initial Payments
- Improved Cash Flow
- Capital Allowances available
- Ownership of Vehicle
