Finance Explained

Customer Guide to Finance

Over the past few years it has become far more common for people to fund their vehicle or equipment purchase with some form of finance. Below we describe some of the more popular types of finance, their benefits and other things you may want to consider.

What is a Representative APR?

A representative APR is not the lowest rate. It's a rate at which 51% of customers should achieve or better given the wide range of individual circumstances our panel of lenders will consider.

Hire Purchase

Hire Purchase lets you spread the purchase cost of a vehicle or equipment over a longer period with fixed regular payments. It can be tailored to suit your budget as there's flexibility on the amount of deposit you put down and the period you take it over.

Conditional Sale

Conditional Sale (like Hire Purchase) is a traditional way of purchasing a vehicle or equipment on finance, offering a straightforward agreement that involves paying a deposit followed by equal monthly payments. Once all the payments have been made the vehicle or equipment is yours.

Personal Contract Purchase

PCP is typically only available on cars and allows you to spread your payments over 2, 3 or 4 years with a guaranteed future value (often known as a balloon payment) at the end of the term. Monthly payments can be lower on a PCP as some of the vehicles value is deferred to the end of the term.

Lease Purchase

Lease Purchase is similar to PCP in that there's a deferred balloon payment at the end of the term making the monthly payments lower than an equivalent Hire Purchase or Conditional Sale agreement. The main difference is that the balloon is not guaranteed by the lender and you cannot simply hand it back at the end of the term.

Personal Loan

A personal loan is an unsecured loan. The money you borrow on a personal loan can be used to buy either a car or a commercial vehicle. The money is paid to you directly so you effectively become a cash buyer, whether you're buying a vehicle from a motor dealer or via a private sale. You then repay this money (with interest) at a set monthly rate within an agreed period, usually between 2 and 5 years.

Finance Lease

Finance Lease is a popular product for business customers such as limited companies, partnerships and sole traders/self employed (it's not available for private individuals). It offers the benefits of ownership because you can take advantage of equity build up in a vehicle (although you will not own the vehicle on a Finance Lease). VAT is only charged on the initial rental, monthly rentals and final rental/balloon, not the initial cost at purchase.

Rates from just 9.9% APR.
(The exact rate you will be offered will be based on your individual circumstances)

Representative APR 17.2%.

Representative example:

Borrowing £11,000 over 4 years with a representative APR of 17.2%, an annual interest rate of 17.2% (Fixed) and a deposit of £0.00, the amount payable would be £311.61 per month, with a total cost of credit of £3957.28 and a total amount payable of £14957.28.

Rates may differ as they are dependent on individual circumstances, the lender you are approved with and the vehicle/equipment purchased.

(Click here to find out what a Representative APR & example is)

Finance is subject to status.

Warning: Late payment may impact your credit file and the lender may reclaim the vehicle or equipment financed prior to the end of the term of the agreement.

Company Information
Proactive Vehicle Finance is a trading name of Proactive Vehicle & Equipment Finance Ltd, registered in England & Wales under company number 12688016. Registered office address: Whitfield Business Hub, 184-200 Pensby Road, Heswall, Wirral, CH60 7RJ. Proactive Vehicle & Equipment Finance Ltd is authorised and regulated by the Financial Conduct Authority under FRN 930768. You can check our registration via their website: https://register.fca.org.uk/ We are registered with the Information Commissioner's Office under ICO registration ZA787680 and our VAT registration number is GB362252907

We are a credit broker not a lender and can introduce you to a select number of finance providers who may be able to offer you a credit facility for your purchase. We will only introduce you to these lenders and we will receive a commission from the lender, calculated either as a percentage of the balance financed or a fixed amount, if you decide to enter into an agreement with them. The commission we receive from the lender will not impact the amount that our retail customers/consumers pay under an agreement but may impact the amount that our corporate customers pay under an agreement we arrange.
Finance is subject to status, terms & conditions and you must be a UK resident aged 18 or over in order to apply. Guarantees and indemnities may be required.
All calls are recorded for training and quality purposes.