Van Hire Purchase
Van hire purchase is the most simple basic form of funding. Its a loan secured against the van. Its also named Lease Purchase but lease purchase is usually with a balloon at the end.
Explode the Myths
VAT & Van Hire Purchase
Lets explode a few myths here as things have changed a lot in recent years. Traditionally VAT is placed upfront but in recent years this has relaxed and there are a few funders out there that will defer VAT for up to three months. In fact there are even a few funders now that will finance the VAT
A ballon is a slang but widely accepted term for a large final payment.
Some finance companies allow percentage of the purchase price while others use quite complicated equations and auction feeds.
Typically a balloon is worked out to about 85% of its auction value excluding any extras adjusted for mileage. Thus a driver who does 100,000 miles a year will have higher payments and a lower balloon that a 10,000 mile per annum driver
HP and Lease Purchase get a 100% tax write down all in the same year.
So it suits companies that want to shed as much as possible that financial year. Thus is you are a new start company or your profits are low finance lease is often a better method as it transfers some tax savings into later years.
Who does It Suit?
Flat rate VAT customers for sure. Large VAT registered companies.
Customers buying a motor home, intact anyone who wishes to take ownership of the van at the end. The payments are often a great deal higher than finance lease for example.
Finance Lease Declines
If you are declined on finance lease or contract hire we can still often get you a line of credit on HP. Its because a banking credit check is often different to an Experian one but our rates are far far lower than you will get from your high street lender. They rely on you walking in