There are a lot of options available when it comes to financing your car. Hire purchase (HP) is a popular choice, but what is it? Hire purchase is a type of secured loan and is similar to borrowing the money from a bank or building society.

It is a loan that the lender, (obtained through the car company) can secure against the car. You pay the price of your car through monthly payments; the monthly payments can vary depending on the initial deposit paid, the sale price of your car and the number of months your loan will run for. At the end of the contract the vehicle becomes your property.

If you have a decent deposit to put towards your car this will lower your monthly payments considerably, you can also chose the length of your loan, this too can have a huge impact on your monthly payments, it all depends on how quickly you want to pay the loan off and own your car.

HP is a good option for those who intend to own there car at the end of the loan and for someone who does not want any mileage restrictions.