Hire purchase, allows you to pay the cost of the van over a set number of years. You will pay a deposit and the balance of the van plus any interest is paid off in monthly instalments. The more you borrow and the longer you take to clear the finance the more interest you will pay. Until the van is paid off the finance company will retain ownership. You can pay off the outstanding balance at any time (usually incurs a penalty) but you will get an interest rebate of the remaining term.
HP is flexible when it comes to the size of the deposit you put down and there is no balloon payment at the end of the agreement. Once the final payment is made you will own the vehicle outright.
For Camper Vans, it is possible to take out up to 12.5 years and Motorhomes 15 years term Hire Purchase agreements. Financing your van over these terms will keep your monthly payments down but will incur more interest.
This option allows you to pay smaller monthly payments because you have a balloon payment at the end of the agreement (you are deferring this amount of the loan until the end of the term) you will incur extra interest over the term on the deferred amount. You can pay a deposit up to the value of 12 monthly payments and the terms range from 24 to 48 months. At the end, of the term, you must pay the last monthly payment plus the balloon amount if you do not have funds to do this you may be able to refinance this amount or hand the vehicle back to the finance provider.
Once all payments have been made including the final balloon payment you will own the vehicle outright.