Hire Purchase from HSBC Vehicle Finance (UK) Limited allows you to buy vehicles without having to find the cash 'up front', giving you similar tax and balance sheet advantages as a cash purchase but without the drain on your cash flow or capital. Vehicles appear as an asset on your balance sheet - when you've finished the repayments you can pay a nominal 'option to purchase' fee to own them.

The repayment period can be from 12 months to 5 years. Interest rates and repayments are fixed and agreed at the outset, and both new and used vehicles (up to five years old at the outset) can be included.

Hire Purchase gives you:

• Flexibility - arrange the finance with us beforehand and negotiate your own deal as a 'cash' buyer
• Tax efficiency - as the owner of the vehicle for tax purposes you can claim available Writing Down Allowances
• Low deposits - the minimum deposit is just 10% (plus the VAT on the purchase price of commercial vehicles)
• Improved cash flow - no need to tie up large amounts of capital in the vehicle
• Minimised VAT outgoings with no VAT on monthly instalments
• Flexibility - payments can be structured to match your business's cash flow and the predicted use of the vehicle
• An additional asset on your balance sheet to increase your company's asset base
• Borrowing efficiency - no additional security is normally required, leaving your other borrowing facilities free to fund other areas of your business.

Is it for me?
This product is ideally suited to business customers who wish to purchase vehicles that will be no older than 7 years at the end of the agreement. Customers who are interested in financing more than 25 vehicles should contact HSBC Vehicle Finance (UK) Limited on 08456 09 06 08 or e-mail us at info@vehiclefinance.hsbc.co.uk.

What does it cost?
Fixed rate interest is calculated as a percentage over the Cost of the Funds. The rate will be agreed with you at the outset. An arrangement fee of £100 and a £40 (plus VAT) 'option to purchase' fee will apply.

Protect your interests
For added security, you can choose to protect your loan against unforeseen circumstances. Our Hire Purchase Protection Plan protects the repayments you make on the vehicle, and provides you with life cover for balances (less arrears) of up to £20,000, together with accident and sickness cover to protect repayments for up to 12 months. This product costs just £5.12 per £100 of the monthly repayment.

You should also consider GAP insurance, which is designed to cover the shortfall between the settlement figure on any outstanding finance and the insurance payout in the event of a total loss of the vehicle. This provides cover up to a maximum of £7,000, and is competitively priced at a single premium of £95.

Next Steps