This topic covered Lease Purchase.

  • A Lease Purchase is similar to a Hire Purchase or Conditional Sale agreement except that payments are structured like a lease agreement where the customer makes a number of payments in advance rather than a deposit.
  • A balloon payment can also be incorporated into an agreement, which represents the future residual value of the vehicle.
  • As it is a purchase plan, the payments do not attract VAT and the customer can take title/ownership of the vehicle at the end of the agreement.  
  • Lease Purchase agreements can be regulated, exempt or unregulated depending on the type of customer and the amount of credit.