Buying a used Nissan with hire purchase (HP) car finance

The pros and cons of HP car finance

Borrowing money to buy anything comes with risks, as well as rewards.

Buying a used Nissan could be the right choice for you and an ideal solution to the practical challenges of getting about day to day. However, whilst a used car can be significantly cheaper than its brand new alternative, it still involves spending a lot of money.

When you borrow money, you need to make sure you can keep up with payments comfortably. You will have other bills to pay and necessary things to buy, so you don’t want to find that the payments on your Nissan are leaving you short of money each month.

There are also other considerations when buying a used car and below we share the pros and cons, to help you decide if applying for HP car finance is right for you.

The pros

• Drive away in a Nissan today: with HP car finance you can get a Nissan, even if you don’t have all the money for it right now.
• Spread the cost of owning your Nissan: cars are expensive, but are often an essential part of daily life. When you buy your Nissan with HP car finance, you can pay for it gradually over time.
• Manage your finances: HP car finance comes with a clear payment plan. You can easily compare what your finances will look like each month by taking away the money your Nissan will cost you, alongside your other bills and costs, from your income to make sure it is affordable for you.
• Decide how much you can afford each month: if you find the Nissan you are looking at is too expensive per month, you can look at other options, with lower monthly costs.
• Choose a term that suits you: you can repay over 3-5 years, which will impact the monthly cost to suit your monthly finances. Borrowing for longer reduces the monthly cost, but be aware it may increase the total amount you repay.
• Own your Nissan at the end of the term: If you keep up with your monthly payments, and can afford the “option-to-purchase” fee, you will own your Nissan at the end of the term of your agreement.

The cons

• Delayed ownership: You won't own the car until the final payment is made. Missing payments could result in your Nissan being repossessed.
• Depreciation: Used cars can lose value quickly. You might end up paying more than the Nissan is worth over time.
• Higher total cost: The total amount paid, including interest and fees, will be much higher than the Nissan's purchase price.
• Insurance requirements: Comprehensive insurance is required, which can be more costly.
• Credit impact: Missing payments can negatively affect your credit score, making future borrowing more difficult.
• Repossession risk: Failure to make payments can lead to the car being repossessed, possibly leaving you with outstanding debt.

Please make sure you read and understand your hire purchase agreement, maintain your car and ensure you can afford the payments before committing.