HP Plus is a fixed rate Hire Purchase (HP) product designed by JCB Finance to provide UK businesses with a way of spreading the cost of buying JCBs, plant, equipment and vehicles, through regular fixed instalment payments and have the flexibility to make ad-hoc lump sum payments and reduce the interest charged. Plus, this facility comes with a built-in payment holiday feature which enables you to take unplanned payment holidays without effecting your credit rating.
On a HP Plus agreement, the interest on the amount borrowed is estimated at the start if of the agreement and collected in the instalments (made up of capital and interest).
The actual interest applied is calculated daily (using the fixed rate) on the balance outstanding, so, any change to payments made would alter the actual interest due - making it a cost-effective option if lump sum payments or settling the agreement early is likely.
Additional payments made would shorten the agreement and any missed or delayed payments would lengthen the payment period, and the interest would be calculated at the fixed rate agreed.
Payment Holiday Feature:
Businesses who purchase plant, equipment and vehicles may choose to fund them using HP Plus and preserve their working capital (cash), for things like tax, fuel, wages, and other running costs. As the interest rate is fixed at the outset it hedges against inflation and interest rate rises making it an option that helps with accurate budgeting.
A schedule of monthly instalments is agreed in advance, which helps with cashflow planning and budgeting over a period to match your business needs. The payment holiday feature is only available on agreements which are up to 60 months duration from the outset.
Ownership of the goods will be yours when you have made all payments including an Option to Purchase Fee.
VAT relating to the purchase price is usually payable at the start of the agreement and is usually reclaimable. Tax relief may be available, including the Annual Investment Allowance or Corporation Tax full-expensing relief.
The typical duration 1 year to 5 years, borrowing over £5,000.
Goods may be repossessed if you do not keep up with instalments.
HP Plus is not available on regulated credit agreements (i.e. if you are a sole trader or partnership with 3 or less, borrowing up to £25,000).
What happens at the end?
The duration of the agreement is estimated at the outset and subject to payments being made when they fall due. Any change, including payment holidays taken may result in the agreement duration being longer, or shorter if lump-sum payments have been made. Once all payments and interest payable has been settled, you pay a nominal option-to-purchase fee, and ownership transfers to you.
How to apply
Call us on 0800 150650 and speak to one of our Relationship Managers. Open Monday to Friday 8.30am to 4.45pm, excluding Bank Holidays. See How to apply for finance page for more details.
How does this compare
Disclaimer
Finance provided and subject to acceptance by JCB Finance Ltd (Registered in England No.972265 Registered Office: The Mill, Rocester, Staffordshire, ST14 5JW) who are registered with the Financial Conduct Authority as a lender. UK business users only. Terms apply. Subject to your consent, JCB Finance Ltd will pay a commission to the UK JCB dealer network which is a flat fee plus basic rate tax and employer National Insurance contributions for each JCB machine on the finance agreement. These payments are not additional fees that you will have to pay and is not added to the amount you pay under your finance agreement. Other products are available see JCB Finance Finance Options Explained
FAQS
When can I take a payment holiday?
If your HP Plus agreement is eligible for a payment holiday you can request to pause your payments from the 4th month after your agreement started (‘Effective Date’). If you have already taken a payment holiday your subsequent holidays must be 3 calendar months after the previous. Only 1 payment holiday of 1 or 2 months can be taken per year (12 calendar months) and a limit of 6 months payment holiday per agreement applies.
How to take a payment holiday?
You can request to take a payment holiday in a few simple clicks using your JCB Finance Online account. Alternatively, you can email customerservices@jcb-finance.co.uk or call 0800 150 650 and speak to a member of the team. A minimum of 15 days notice before your payment is due must be given.
What happens when I take a payment holiday?
When a payment holiday has been activated your direct debits is suspended and the payments recommence automatically – do not cancel your direct debit. The payments paused will be added onto the end of your payment schedule. If the payment made haven’t been sufficient to cover the whole of the actual interest calculated in your payment period, this unpaid interest shall accrue as a deferred charge and attract interest at the fixed rate stated on your agreement.
What happens if your payments don’t cover the actual interest due?
JCB Finance can review the outstanding balance and any unpaid interest (deferred charge) on or before the 3rd anniversary of when your agreement started and will communicate a decision to extend the period of hire at the current payment levels, adjust the payment values for the remainder of the period, or notify you of a balancing payment required.
Do I have a lump sum to pay at the end?
You may choose to have a final lump sum ‘balloon’ repayment – this would reduce the amount you pay in your regular payments, but the balloon must be paid by you in full when it is due. The amount due would feature on your quotation and documented on your agreement from the outset. Having a balloon is likely to result in you paying more interest so speak to JCB Finance for details.
Can I make changes once the agreement has started?
Some changes are possible e.g. changing monthly payment date. Fees and/or additional interest charges may apply if you wish to make a change after the agreement has started.
Can I end early?
If you wish to settle your agreement early you can request a quote via your JCB Finance Online account or email settlements@jcb-finance.co.uk or call 0800 150 650.
What are the fees?
HP Plus has an acceptance fee, payable with the first payment after the agreement has started and an Option To Purchase fee payable with your final payment. These are payable on all Hire Purchase agreements and are documented from the outset.
What if my circumstances change?
Contact the Customer Services Team on 01889 594101 or customerservices@jcb-finance.co.uk who will be happy to assist you and discuss what options are available. Open Monday to Friday, 8.30am to 4.45pm (excluding Bank Holidays).
What if I want to sell the goods?
You cannot sell (or pass title) to any goods until you are the legal owner. When all payments have been made, including the Option To Purchase Fee stipulated on your agreement you have ownership of the goods.
If you wish to settle your agreement early you can request a quote via your JCB Finance Online account or email settlements@jcb-finance.co.uk or call 0800 150650.
What if bank base rates change?
The interest on a HP Plus agreement is calculated at a fixed rate of interest, agreed and documented at the outset. Therefore, the interest payable on your agreement is not affected by any changes in bank base rate once your agreement has commenced.
What about insurance?
You have a duty under the agreement to insure the goods on a comprehensive basis.
Can I have use HP Plus for the JCBs promotional offer advertised?
Financial promotions are based on specific agreement types as stated. The way that interest is calculated and applied to a HP Plus agreement is different to that of standard Fixed Rate Hire Purchase and comes with different features. An alternative proposal can be prepared for you if you prefer the features of HP Plus. Speak to your Relationship Manager or call 0800 150650 to discuss.
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