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Thread: Hire purchase no longer offered by Motability

  1. #1
    New Member
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    Unhappy Hire purchase no longer offered by Motability

    Hie all

    I rang Motability operations on Thursday regarding the Hire Purchase option and was initially informed that there was no such thing. After insisting that I knew what I was talking about (I was approved for the HP loan 3 years ago but went for the contract lease - now regretting), I was informed that the HP option needed on 30th June 2014! and Motability Operations no longer have the license to run the HP scheme. I am really disappointed and upset that Motability are claiming that the uptake of HP scheme was poor yet it was never promoted as much as the contract hire which earns them more money. I have had a contract hire car for the past 3 years and after paying an advance payment and the monthly rental just adds up to a lot of money down the drain yet I do not own a car. Anyone else feel this way?

  2. #2
    Senior Member
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    From what I can tell from the Financial Conduct Authority web site, Motability still have an interim consumer credit licence. However, the web site might be out of date, also being licensed doesn't mean they are still offering a hire purchase scheme. As you say, hire purchase was poorly promoted and few opted for it.


    You do have the option to buy a contract hire car after three years (or five years if a WAV or if you are able to extend the lease) at roughly the market value. This may work out a reasonable option compared to outright purchase on HP - it depends on the vehicle. Though you've paid Motability a lot of money for the contract hire, they've taken the bulk of the depreciation on a new car, as well as paying for the servicing, maintenance, breakdown cover and insurance for the hire period.

  3. #3
    Senior Member Lighttouch's Avatar
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    With the Bank of England holding base interest rates at 0.5% for years on end I doubt that Motability could be bothered to try and compete with the many lenders who could offer very comoetitive rates especially if you already had taken out another service with them.

    http://www.tescobank.com/loans/?atla...h/bing/generic

  4. #4
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    I believe the cheapest loan rate Motability offered was 9.7% APR which isn't competitive at all.

    Unfortunately it may affect those with a poor or no credit history as those using Motabilty's HP scheme didn't have to go through a credit check.

    The link Lighttouch has posted - Tesco Bank, I know they will take your benefit as a payment against a loan, Sainsburys Bank will also do the same. Shop around and see who else will help.

    It may feel like wasted money but as Flymo alluded to it's still far cheaper than buying private, plus you weren't forced into the contract hire scheme. Given the amount of AP you paid it may be prudent to try and buy your current car - a family member is also allowed to buy it too.

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