What are the different types of commercial vehicle finance

One type of commercial vehicle finance is known as contract hire. This is generally known as being a no-risk arrangement, designed for companies who have a limited budget each month and who need their finance arrangement to include vehicle maintainable. When your contract hire arrangement finishes, the company hands the vehicle back with no other worries. This type of finance makes it easier for a company to budget and monthly maintenance of the vehicles is included in the price.

Similar to the contract hire commercial vehicle finance is contract purchase. This type of finance is specifically designed especially for companies who wish to have their own vehicles without the worry of them depreciating in value. The major difference between the two is when you wish to sell your vehicle, the finance company guarantee your sale at a price you have both agreed.

The most popular type of commercial vehicle insurance is known as a finance lease. The basics of this type of finance are the company is given the option, they can either pay for the full cost of the vehicle including interest in a monthly repayment plan or you can pay a lease fee each month with the option to buy at the end of the arrangement. The vehicle will be sold to you at the current market value at the time, not at the price it cost brand new.

A lease purchase is where the company is offered the funds it needs to buy a vehicle of their own. There is no maintenance included with this type of finance and when the lease purchase arrangement is over the company keeps the car with no option to return it.

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