Here at A Class Business Finance, we offer hire purchase solutions for businesses wishing to purchase assets for their company.
What exactly does hire purchase mean?
Hire purchase refers to an arrangement in which a financier purchases an asset which is then paid off by the borrower through a loan repayment system.
What is the purpose of a hire purchase?
A hire purchase system is often used when a company wishes to procure an asset, but does not wish to pay for it in a lump sum, outright. There are many reasons why a company may wish to choose a hire purchase options. Businesses may wish to take out a hire purchase loan if they do not have enough liquid capital for the purchase of the asset.
What does hire purchase work?
A hire purchase means the financier purchases the asset and the borrower then buys the asset through repayments over the course of a loan term. With hire purchase loans, the financier owns the asset until you have fully repaid the loan, including balloon/residual repayments, where applicable. You can choose to make a deposit on the finance price if you wish, however, in most cases this isn’t required.
If you take out a hire purchase loan with A Class Business Finance, the interest rate on the loan is fixed, as are the repayments during the lifetime of the loan. Balloon/residual payment options are also available.
At the end of your loan, provided all repayments including applicable balloon/residual repayments have been made, you will have purchased the asset from the lender and will now own it outright.
When repaying a hire purchase loan, there may be benefits such as tax deductions for depreciation and interest, so it is important to discuss these possibilities with your accountant.
How can we help you?
Here at A Class Business Finance, we aim to simplify the finance process, and ensure you get the right type of loan for your needs. With over a three decades of experience in the finance industry, we offer competitive rates and solutions tailored to your business. Our team of experts take an active interest in understanding your requirements and future goals, and we hope to work with you in become trusted finance partners in your business.
If you’re interested in chattel mortgage options, why not arrange an appointment with our friendly staff today, and see for yourself what our A Class service is all about?