Hire Purchase (HP) agreements are the most common way of purchasing your car. Think of HP agreements like cash loans you would normally get from your bank. With HP you will normally pay a deposit your car and then pay the rest of the balance via fixed monthly instalments. The term of the agreement will normally range anywhere from 3 to 5 years. The shorter the term, the less interest you will pay, however, bear in mind your monthly payments will be higher. When you have made your final payment you will own your car. Remember, you won’t be able to sell your car without first settling any remaining finance. Monthly payments will generally be higher with a HP agreement than with PCP, because you are paying off the full value of your car.