Funding Packages from Arrowhire

Arrowhire have a comprehensive range of contracts that can be tailored to suit every business/private individual. We have a range of finance package, so that you can choose the correct funding method to suite your company/personal requirements. To enable all our clients to forecast and budget accurately over a fixed term, Arrowhire offer fixed monthly rentals and fixed interest rates for the term of all our contracts.

What is Contract Hire?

Contract Hire is an agreement to lease a vehicle (car or van) for a set time period (and mileage) at a fixed monthly cost. The monthly Contract Hire rental amount is based upon the original cost of the vehicle, the mileage that is to be covered and the Contract Hire rental period (for example 24 months). An allowance for depreciation is also factored in to the final Contract Hire monthly cost. Maintenance packages can often be included within a Contract Hire agreement but these are not obligatory. Such Contract Hire maintenance packages would typically provide cover for all car or van servicing within the period of the Contract Hire agreement. Contract Hire agreements are usually preferred by vat registered companies, sole traders and partnerships.

No Depreciation Risks.
No Disposal Issues Or Costs
Off Balance Sheet Funding.
100% VAT Recoverable If Sole Business Use Applies.
50% VAT Reclaimable If Business Or Private Use Applies.
Road Fund Licence Is Included For The Term Of The Contract.
Option Yo Include Maintenance For The Contract Term.

What is Finance Lease?

Finance Lease is an increasingly popular vehicle financing option. In a Finance Lease arrangement, the monthly rental you pay is calculated by taking into account the actual cost of the vehicle, the period you want the rental to run and the forecasted future value (residual value) of the vehicle based on the annual mileage. A final payment which is equal to the estimated future value of the vehicle is paid at the end of the contract. At the end of the contract period, the vehicle is sold and 98% of the sale proceeds returned to you. If you decide to use a Finance Lease arrangement for your vehicle, there are usually two different options open to you: firstly, you can opt to spread the pay entire cost (the cost of the vehicle and interest payments) in agreed monthly installments spread over the period of the lease agreement. Secondly, you can choose to make deferred payments. In this situation you make lower monthly installments but then make one final payment (commonly known as a balloon payment) at the end of the lease. It’s worth noting that in a Finance Lease arrangement, you actually never become the owner of the vehicle. At the end of the lease agreement, the final balloon payment is made to the finance company and the vehicle is sold on to a third party. Finance Lease as a vehicle funding option does have a number of benefits. Like Contract Hire, 50% (vans 100%) of the vat payments can be reclaimed and, also like Contract Hire, you can apply for certain tax allowances and the vehicle can be treated as an asset on the balance sheet. Finance Lease also gives you the option of lower monthly payments and a low initial outlay. You may also benefit from an equity resulting from the final sale of the vehicle.

Sole Business Use 100% VAT Recoverable
Business Private Use 50% VAT Reclaimable.
Option To Exchange Or Dispose Of The Vehicle Throughout The Contract.
On Balance Sheet Funding, Shows As An Asset.
On disposal equity retained by user.
Option to include maintenance.