Find out more about the different finance options available from The Co-operative Motor Group. These include Hire Purchase, Low Payment and Personal Contract Purchase Plans.
Hire Purchase (HP) is very similar to borrowing a sum of money from a bank and paying it back over a fixed period of time, with interest.
Hire Purchase is a type of secured loan which are often preferred over alternative (unsecured) loans because they allow a greater borrowing limit. The term "secured loan" means exactly that, a loan that the lender can secure against an asset (in this case, the vehicle). HP gives you additional rights over those of a personal loan and is only available through dealers that have passed the stringent approval process of the finance companies.
Low Payment Plan will enable you to purchase your next car with lower monthly repayments.
The way this is achieved is by deferring an amount of the total cost of the vehicle to the end of the agreement. This amount is known as the Residual Value (RV). It is the customers responsibility to settle the final payment either though additional finance, cash or settlement by part-exchange. The Low Payment Plan product and has no tie to a mileage contract. Repayment periods are typically taken over 2, 3 or 4 years and settlement can be made at any stage of the agreement. We would recommend that you select your anticipated annual mileage to a realistic level so that a realistic Residual Value is set for the vehicle. At the end of the agreement you have three options:
A Personal Contract Purchase (PCP) plan will enable you to purchase your next car with lower monthly repayments.
The way this is achieved is by deferring an amount of the total cost of the vehicle to the end of the contract. This amount is known as the Guaranteed Future Value (GFV). The Guaranteed Future Value plus your deposit is subtracted from the cash price of the vehicle and your monthly payments are based on the balance (plus interest on the balance and the GFV). By only repaying the difference between the cash price and the optional balloon payment you are only financing the depreciation of the car.
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