Credit Sale: Common Profiles

Credit Sales are normally a fixed cost, fixed term loan.

Deposit

Payment of a deposit or advance rentals is normally optional (or a minimum/maximum amount is set by the lender) and can be made with cash or using any part-exchange equity.

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Fees

There is usually an arrangement fee charged by the lender that can be paid at the start of the agreement or included as part of regular repayments for the term of the agreement. The fee amount is set by the individual lender.

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Regular monthly payments including interest

The customer agrees to make regular payments to the finance company and should keep the vehicle fully insured and in good condition.

The vehicle immediately becomes the property of the customer and cannot be repossessed if payments fall behind.

There are also no termination rights on Credit Sales, or restrictions on mileage or use of the vehicle, as the title is immediately transferred to the customer.

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Balloon payment

It is possible to include in the agreement a balloon payment that the customer is liable to pay at the end of the term, but this is not common.

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