Hire Purchase with balloon paymenthire purchase with one significant distinction
Hire Purchase with balloon payment is the same as the standard hire purchase with one significant distinction.
Part of the cars cost is deferred until the end of hire purchase period. This is known as a hire purchase "balloon payment".
One key characteristic of a hire purchase balloon payment agreement is that the monthly repayments will be lower. This offers you the chance to choose a higher specification car.
At the end of the hire purchase contract, you can either make the hire purchase balloon payment to own the car outright, refinance, part-exchange or sell privately to pay off the loan.