Regulated Hire Purchase

• Hire Purchase is a contract between two parties where one party, the owner (DLL), allows the other party, the customer (you), use of their equipment for a period of time in exchange for the customer making regular payments. At the end of the term, you can purchase the goods by paying a (usually nominal) option to purchase fee.
• The Hire Purchase agreement is regulated by the Consumer Credit Act 1974 (as amended) if:
  • It is a business credit agreement where the total amount borrowed is less than £25,000; and
  • You are a sole trader, partnership of 3 partners or less, or an unincorporated body such as a club or society.

• You control the buying process by selecting the supplier and providing they are approved by us, we pay them for the equipment you select, at the price you have agreed.
• Some manufacturers and dealers support the sale of their equipment to enable us to provide preferential financing terms.

• Hire Purchase provides you with a way to use, pay for and eventually own equipment over a fixed period. This can spread the cost of more expensive items over a pre-agreed term.
• Hire Purchase must be used for approved business equipment.
• We will acquire the equipment you specify at the price you agree from your nominated supplier.

It may be suitable for any UK based business:

• Where you are a Sole Trader, Partnership of three partners or less, or other unincorporated body such as a Society or Club.
• Who can demonstrate regular income.
• Where you are looking to acquire equipment by paying for it over a period of time, whilst it contributes to the business.

• Convenient, easy application process.
• Typically, no additional collateral or security is required.
• Unlike a bank overdraft, a Hire Purchase cannot be terminated by us unless you are in breach of the terms and conditions of the agreement, or a specified termination event occurs.
• Alternative line of credit for the business to your main business funding facilities.
• Interest element of the payments can be deducted as a trading expense.
• Equipment is shown as an asset and a reducing liability on your balance sheet.
• Payment amounts are fixed and scheduled and help with budgeting and cashflow.
• Equipment acquired by us at the net cost agreed by you with your supplier.
• VAT on cost price of goods payable by you immediately – may be funded for a short period if required (ask for details).
• Economic ownership for accounting and tax purposes rests with you (ask your accountant or financial advisor how this affects your business circumstances).

• Capital Allowances are claimed by you even though you do not own the equipment immediately.
• Check with your accountant how this agreement will be recorded in your financial statements.

To help DLL decide whether to offer you a Hire Purchase we may use:

• Any information you have given us e.g. business accounts, bank statements.
• If you have been a customer before, any information we already hold.
• Information we receive from enquiries.
• We may also view your credit history with a credit reference agency or ask them to make enquiries for us.

• You have the right to cancel the agreement within 14 days of receiving either a copy of the signed agreement, or notification that the agreement has been signed by us.
• If you wish to cancel the agreement, you can do so by contacting us in writing at the address provided below.
• If you cancel the agreement, please note that you would only be cancelling this agreement and not necessarily any agreement for services you have entered into with the supplier and you may still be liable to make them good on the transaction.
• Once the cancelation period has expired, you have limited rights to automatically terminate the agreement. Once you have paid 50% of the Full Cost of Credit stated in the agreement you can return the equipment to us with no further obligation.
• If you have any queries, contact us to discuss your options.

• We will ask your permission before making a check on your credit history with a credit reference agency.
• Our enquiry will show on your record with them and may affect how others subsequently use this information in granting credit to you.
• If you fail to make payments on the due dates, we will register this with a credit reference bureau. This may affect how others view your creditworthiness.

To ensure that payments are made on the right date all payments must be made by Direct Debit.

• Interest rates used to calculate the repayments are fixed at the outset and will not change once your Hire Purchase commences.
• Details of the amount of interest and the rate charged (the Annual Percentage Rate), will be detailed on your agreement and it is essential that you read this carefully before deciding whether to accept the terms.

• Interest rates used to calculate the repayments are fixed at the outset and will not change once your Hire Purchase commences.
• Details of the amount of interest and the rate charged (the Annual Percentage Rate), will be detailed on your agreement and it is essential that you read this carefully before deciding whether to accept the terms.

Your agreement will clearly state the rental amounts, number and frequency along with the due dates.

• Commission may be payable by us to the supplier of the equipment and/or your finance broker and/or any other connected party.
• Details of any commission paid, including the amount and how it was calculated, can be obtained from the dealer/broker or us on request.

• In the first instance, you should speak with the supplier to see if they are able to rectify the problem or suggest another suitable remedy.
• If the supplier is unable to resolve the issue you should contact us and we will take steps to try and resolve the issue.
• If the cost of the equipment is below £30,000 you may have a right to take legal action against the supplier, or us, or both, under Section 75 of the Consumer Credit Act. Speak to your legal advisor or contact us to discuss what your rights are.

• You can settle the Hire Purchase Agreement early. Contact us for a settlement quote.
• You can return the equipment at any time once you have paid at least half of the total Hire Purchase Price stated in the agreement, plus any arrears with no further obligation.

• Making timely payments on the due date is a strict condition of the agreement and why we collect payments by Direct Debit from your bank.
• Failing to make payments on the due dates will mean that you have broken the terms of the Hire Purchase Agreement.
• You should contact us before you intend to miss a payment to see if there is a way we can help, e.g. change the date of payment, reschedule future payments.
• If you fail to contact us, we will contact you to discuss your options for bringing the agreement back up to date.
• If you fail to make your payment(s) on the due date(s) it can affect you credit rating. This may have severe consequences on your ability to obtain future credit and/or It may make future credit more expensive.
• This may lead to us taking action to recover the equipment and any associated costs.
• If you have paid more than 1/3rd of the total Hire Purchase Price stated in the agreement, we can only repossess the equipment with an order of the court (In Scotland we may need an order at any time).
• If you have paid more than half of Hire Purchase Price stated in the agreement, plus any arrears, you may return the equipment to the us with no further liability.
• Full details of the consequences of missing a payment are outlined in the Hire Purchase agreement.

We will contact you at least three months before the end of the lease to confirm your option(s) e.g. return of equipment, continued renting of the equipment or selling as our agent.