Free calculator

HP calculator

Work out what a car costs on hire purchase. Put in the price, deposit, term and APR to see the monthly payment, the total and the interest. Free, no sign-up.

Your hire purchase figures

Cash price of the car The on-the-road price you'd pay for the car in cash.

Deposit

Part-exchange (optional)

Term (months) Most HP deals run 24–60 months.

Representative APR (%) It's on the finance quote. Use 0 for a genuine 0% deal.

A worked HP example

A £12,000 used car with a £1,500 deposit over 48 months at 9.9% APR, straight from the calculator above.

Worked example: £12,000 car on hire purchase
Deposit paid up front	£1,500
Amount financed	£10,500
Monthly payment	£263.68
Total to own the car	£14,156.64
Cost of credit	£2,156.64

Every pound of every payment is buying the car. There is no balloon, no mileage limit and no condition inspection at the end, which is why HP suits anyone who plans to keep the car past the end of the deal. If a lower monthly matters more than the total, compare it with our PCP calculator.

Figures last checked against the official source on 25 August 2026. Check the source yourself.

How hire purchase actually works

HP is the simplest way to finance a car. You pay a deposit, the lender pays for the car, and you repay them in equal monthly instalments until the balance is gone. The lender owns the car during the deal, and it becomes yours with the final payment.

Because the payments clear the whole price, there are no surprises waiting at the end. No balloon to find, no mileage penalty, no inspection arguing over stone chips. The trade-off is a monthly payment noticeably higher than a PCP on the same car.

Two consumer protections are built in. After a third of the total is paid, the car cannot be repossessed without a court order. After half, you can hand it back and end the agreement, which our voluntary termination rules allow.

Getting a fair HP deal

Compare deals on the total amount payable, never the monthly figure. A longer term shrinks the monthly payment but grows the interest, so the cheapest-sounding deal is often the dearest. The calculator above shows both numbers for any combination.

Check the car before you commit to years of paying for it. The free MOT check sanity-tests the advert in seconds, and the full £5.00 report reads back the mileage trail, tax status and spec on record.

HP calculator: common questions

How is an HP monthly payment worked out?

The price minus your deposit is the amount financed, and the payments clear that whole balance plus interest over the term. Because nothing is deferred to the end, the monthly payment is higher than a PCP on the same car, but once the last one clears the car is yours. This calculator runs the standard amortisation maths on your own figures.

Can I pay off HP early?

Yes. Ask the lender for a settlement figure, which is the remaining balance plus any fees, minus a legally required rebate of future interest. Settling early almost always costs less than running the deal to the end. Under the Consumer Credit Act you can also make partial overpayments to cut the balance.

Can I sell a car that is on HP?

Not until the finance is settled. The lender owns the car until the final payment and the option-to-purchase fee clear, so selling it before then means selling something you do not yet own: it breaches the agreement, and presenting the car as clear can amount to fraud. Any buyer running a finance check will see the agreement against the car, which is also why checking a used car for outstanding finance matters.

What happens if I can't keep up the payments?

Two protections are written into HP law. Once you have paid a third of the total, the lender needs a court order to repossess the car. And once you have paid half, you can hand the car back and walk away from the rest, called voluntary termination, provided the car is in reasonable condition and your payments are up to date.

Is HP better than PCP?

HP costs more each month and less overall, and the car is simply yours at the end. PCP is cheaper monthly because a balloon payment is deferred, but you pay interest on that balloon throughout, so buying the car outright at the end usually costs more in total. If you know you want to keep the car, HP is normally the cheaper route.