Hire Purchase

Hire Purchase provides operators with an easy way of initially renting, and ultimately buying, a new commercial vehicle through MAN Finance.

A Hire Purchase package is, in some respects, similar to Finance Leasing. The important difference being: ownership of the vehicle invariably passes to the operator at the end of the hire purchase period - once an ‘option to purchase fee’ has been paid.

A customer choosing a Hire Purchase option can benefit by claiming any capital or writing down allowances available on the asset.

An MAN Finance Hire Purchase agreement, enables the operator to have full use of the vehicle for a specific hire period, in return for the regular payments of rentals. The operator simply commits to paying a total rental amount which covers both the cost of the asset, and the financing costs. Provided the contract conditions have been met, the operator has the option to purchase the vehicle at the end of the hire purchase period.

Typically this option is nearly always exercised, as it only costs the operator a fraction of the original purchase price to do so.

Under Hire Purchase contracts, operators can include the vehicle as a fixed asset in their balance sheet, benefiting from capital allowances, and further reducing their tax bill because interest paid can be offset against pre-tax profits.

Hire Purchase provides a flexible and cost-effective alternative to bank loan funding, and can even provide operators with an additional line of credit.