If vehicle ownership is your preferred route there are three main options to choose from based on the Hire Purchase principle – Hire Purchase, Hire Purchase with a Balloon Payment or Contract Hire.
Hire Purchase
	You pay a deposit – the actual amount is negotiable – and the remaining costs plus interest is repaid by regular monthly payments. You can also choose from fixed or variable interest rates. A variable interest rate means your monthly paymentssre likely to change from time to time as the amount of interest, which forms part of the monthly payment, is linked to movements in Finance Base Rate ( FHBR).
Hire Purchase With Balloon Payment
	This is exactly the same as Hire Purchase in virtually every aspect. The key difference being that you opt to make a “balloon” payment at then end of the agreement thereby reducing your monthly repayments.
Contract Purchase
	Contract Purchase is a method of acquisition where monthly rentals are kept low by agreeing a lump sum at the end of the term, referred to as the Guaranteed Future Value.
For Hire Purchase and Hire Purchase with Balloon Payment the basic idea is
	You agree an appropriate deposit plus VAT (which is reclaimable) You make monthly or quarterly repayments that include interest for the agreed period. You can choose from fixed or variable interests rates. You can even choose to pay in advance or in arrears.
Key Business Benefits
	• Interest is allowable against taxable profits. • Writing down allowances are claimable. • Additional line of credit. • Vehicle is shown as an asset on the balance sheet. • Regular payments are kept low if a balloon payment is selected. • Repayments not subject to VAT.
For Contract Purchase the basic idea is
	You agree an appropriate deposit. You make monthly or quarterly payments throughout the agreement term The monthly rentals are kept low by agreeing s lump sum at the end of the term. This amount is called the Guaranteed Future Value (GVF) and is based on the mileage you expect to do over the period. At the end of the agreement you have four options: i. Pay off the final lump sum and keep your vehicle. ii. Extend the agreement by spreading the balloon payment over a further agreed period. iii. Return your vehicle, freeing you from any further obligation apart from an excess mileage charge if the estimated mileage has been exceeded, and damage charges over and above fair wear and tear. iv. It may be possible to trade in your vehicle.
Key Business Benefits
	• All the same benefits as Hire Purchase plus: • Regular payments are kept low • Option to not make the final balloon payment and had the vehicle back.
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	For many organisations non-ownership of their vehicles is an important aspect in the selection process. The next step is then to decide whether you want your finance to appear on or off your balance sheet.
Finance Lease-on balance sheet
	Your vehicle is hired to you for a fixed period without the option of ownership. At the end of the contract, the proceeds from the sale of the vehicle, less a small fee, are returned to you.
Operating Lease-off balance sheet
	Your vehicle is hired to you for a fixed period. Monthly rentals are based on the difference between the price of the vehicle at the start of the agreement and its projected residual value, plus finance charges. Therefore only a proportion of the vehicles value is being repaid which avoids any large initial outlay and reduces the monthly rental. At the end of the lease period the vehicle is simply returned, freeing you from any further obligations apart from any excess mileage or damage charges if applicable.
For Finance Lease the basic idea is
	You agree an initial rental You pay monthly or quarterly for the use of a Mercedes vehicle over an agreed period. At the end of the agreement the vehicle must be sold on to an independent third party on your instruction and then return 95% of the sale price to you. Alternatively you may return the vehicle to us. We will then sell it and return 95% of the net sale proceeds to you, after deductions and collection fees. You can choose to pay a final lump sum to reduce the regular rentals
Key Business Benefits
	• You have use of the vehicle without a large capital outlay. • Improved cash flow with fixed monthly rentals. • VAT on rentals is reclaimable. • Rentals are allowable against taxable profits. • On balance sheets. • Your business could benefit from the net sale proceeds. • Optional balloon payment will reduce your monthly/quarterly rentals. • An additional line of credit. • Option to extend at a peppercorn rental.
For Operating Lease the basic idea is
	You agree an initial rental. You agree the mileage you wish to cover over the period of the agreement. This helps us determine the expected “Residual Value” of the vehicle at the end of the agreement. You simply pay monthly or quarterly rentals through the agreement. At the end of the agreement you just give the vehicle back.
Key Business Benefits
	• You have use of the vehicle without a large capital outlay. • Improved cash flow with fixed rentals. • VAT on rentals is reclaimable. • Rentals are allowable against taxable profits. • Off balance sheet • Reduced rentals • No worry or risk at the end of the agreement as you just give it back plus any excess mileage or damage charges if applicable. • An additional line of credit.
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	A Contract Hire is designed to take away the major sources of hassle involved in the often thankless task of running a commercial vehicle fleet. Quite simply, it combines a leasing arrangement with repair and maintenance all included in your monthly payment. _Typically over 3-5 years, a Contract Hire agreement with Mercedes-Benz CharterWay requires no capital investment and the vehicle is off balance sheet. Throughout the life of the arrangement you know in advance precisely what you outgoings will be on a month-by-month basis. There are no hidden surprises or cash flow-disrupting peaks and troughs, which is good for the budgeting process.
A Contract Hire agreement would typically include:
	An operating lease All scheduled maintenance All necessary repairs-including brake pads and clutches 24 hour Roadside Assistance 365 days a year for the duration of the contractin addition it can also cover: Road Fund Licence Replacement vehicle in the event of vehicle breakdown Tyres Maintenance for ancillary equipment such as cranes, fridges and tall lifts Collection & delivery for scheduled maintenance Out of hours servicing Windscreens Fixed penalty administration
Key Business Benefits
	• No disposal risk or hassle • Additional credit lines • Totally fixed and predictable costs • Outsourced administration • Outsourced management • Off balance sheet funding