hp equalised payments

Fix the payment and float the period.

The JCB Finance HP Equalised Payments option is a variable rate hire purchase agreement that makes budgeting easier because of the equal fixed monthly repayments of capital and estimated interest. The actual interest is calculated daily based upon the NatWest base rate. Any movement in the base rate is used to reflect either the shortening or lengthening of the repayment period - hence we describe it as ‘fix the payment and float the period’.

Like other variable rate options, this is popular when interest rates are expected to fall, or you expect to settle the entire agreement early or pay off lump sums.

As the actual interest charged would increase in the event of an increase in the NatWest base rate, customers who expect the rates to go up may wish to consider HP Plus as a fixed interest rate alternative with similar lump sum / early settlement benefits.  

The goods become yours when all payments have been made, including the option-to-purchase.

Note: HP Equalised Payments is not available on regulated credit agreements (i.e. if you are a sole trader or partnership with three or less borrowing up to £25,000).

Benefits of HP Equalised Payments:

• You will own the goods after the final payment
• Enjoy savings when interest rates fall
• Fixed repayments of capital and estimated interest
• No monthly/quarterly interest bills
• Ability to pay off lump sums and save on interest
• VAT is usually fully reclaimable
• Interest charges are usually tax allowable
• Tax writing-down allowance may be available, including the Annual Investment Allowance and Corporation Tax full expensing
• The asset itself offers the security to the lender, therefore other forms of security such as personal guarantees or property are usually not required.

What happens at the end:

You pay a nominal option-to-purchase fee at the end of the agreement, and ownership transfers to you.

Want to end your agreement early?

The interest charges will vary as the capital balance reduces and the interest rate may be subject to change. Interest is calculated daily so you will only pay interest up to the date the agreement ends.

You can request a calculation at any point during the agreement which will show you how much you would need to pay if you wanted to end the agreement early. The goods are yours when all payments have been made.

Thinking of ending early? Request a cancellation

How it compares:

Other considerations:

Assets on the agreement may be repossessed if you do not keep up with the payments

Typically, the minimum balance to finance on any agreement type with JCB Finance is £5,000.

Movements in interest rate can result in differences between the estimated interest included in the payment schedule and actual interest charged. To recover any shortfall in interest the payment schedule may be reviewed, possibly extended.