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What is Business Contract Purchase?

Contract Purchase (CP) is a type of finance agreement for business customers looking to fund a new vehicle in a manageable way

The monthly payments are not subject to VAT, however, if you do take out the optional service package then you will have to pay VAT on the service costs.

 

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Advantages of Business Contract Purchase:
  • Low initial payment
  • Fixed monthly payments
  • You may be able to refinance the OFP
  • No depreciation concerns if you wish to walk away at the end
  • Maintenance and servicing can be included
  • Fixed OFP when you first take the contract out
  • Cost-effective

 

Disadvantages of Business Contract Purchase:
  • You will have to make a decision at the end of the contract as to whether you wish to sell the vehicle, return it or keep it
  • You must have fully comprehensive vehicle insurance

 

More Information on Business Contract Purchase:

CP is ideal for any business that would like options at the end of its finance agreement. CP customers make an initial payment when they first take out the contract, then pay fixed monthly payments and finally have an Optional Final Payment (OFP) at the end of the contract, which is also referred to as the GFV (Guaranteed Future Value).

You can trade-in your vehicle and take another vehicle from us. If the trade-in value is larger than the OFP you will be able to use the difference towards a deposit on a new vehicle. Or, you can simply return the vehicle to the funder, as long as you have not exceeded the mileage and the vehicle is in an appropriate condition for its age there will be no charge. Finally, you can keep the vehicle either by paying the OFP in full or you will find that most companies offer the opportunity to re-finance the OFP.

 

Get in touch for more details