Contract Purchase is an on-balance sheet method of funding.
Simply choose your vehicles and the finance company will buy
them. You then pay a fixed monthly sum for the duration of your
agreed loan period. At the end of this term, you’ll have the option
to purchase each vehicle by making a final ‘balloon’ payment
based on its residual value. Alternatively, the finance company can buy the vehicle
back at the “balloon” value and provided there is no excess
mileage or damage to the vehicle there is nothing further to pay.
Contract purchase agreements usually have the option to include maintenance giving you peace of mind that both finance and maintenance costs are fixed throughout the duration of the contract.
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.
Each funding option is designed to cater for different, specific
Although a simple concept in principle, fleet funding can be a minefield if you’re not properly prepared. With so many companies, deals and advice out there in the market, it’s easy to get confused about which option is best for your business.
The type of funding you choose can make a significant difference to your overall costs, risk and flexibility – so it’s crucial to understand everything properly before making your decision.
We can help you understand more about the impact of the various funding options available to you and can help identify the most appropriate funding method for your needs.
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 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. 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.
* All vehicle images and car descriptions on this site are for illustration and reference purposes only and are not necessarily an accurate representation of the vehicle on offer.
T: 01702 410 470
Planet Leasing Limited
91-93 Leigh Road
Planet Leasing Limited are a credit broker and not a lender, we are authorised and regulated by the Financial Conduct Authority. Registered No : 688093. Planet Leasing Limited is an Appointed Representative of AutoProtect (MBI) Limited which is authorised and regulated by the Financial Conduct Authority for Insurance Mediation, their reference number is 312143. You can check this on the FCA Register by visiting the www.fca.org.uk or by contacting the FCA direct on 0300 500 8082
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Registered Office : 601 London Road, Westcliff-on-Sea, Essex, SS0 9PE
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