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Hire Purchase Vrs Lease.

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  • 25-06-2010 10:29am
    #1
    Caoimhín
    Closed Accounts Posts: 3,789 ✭✭✭


    Morning all,

    Can anyone tell me the difference between hire purchase and lease. I have a choice between the two for a car loan.

    Thanks in advance.


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    #2
    Mountjoy Mugger
    Registered Users Posts: 4,487 ✭✭✭Mountjoy Mugger


    The Farmers Journal explains it.

    Bottom line, with leasing you don't own it in the end. With hire purchase, you do.


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    #3
    coffee_cake
    Registered Users Posts: 81,310 CMod ✭✭✭✭coffee_cake


    I guess since he says a car loan there's an option to purchase it at the end, but that is just an option OP and you'd have to check that out very carefully. I also imagine there'd be a high cost of the purchase payment if it is an option to purchase lease, whereas at least with HP you'd be spreading it out over the term.
    Best to check with the bank...

    in other regards they're fairly similar, you don't actually own the vehicle until the end (and generally with a lease you don't own it ever), if you default they can repossess, etc


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    #4
    daithimac
    Registered Users Posts: 515 ✭✭✭daithimac


    the main think to consider is tax. If you are registered to claim VAT back then by going with lease you can claim 21% back and will automatically get a summary of tax so send to the revenue.

    I presume that if you are being offered the car under lease that you will be using it for professional purposes. If not for professional use then lease may not be a good option as consumer credit laws such as the 1/3rd and 1/2 rule do not apply to lease.


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