Hire purchase finance (HP) is an excellent way of buying a car when you don’t have the money to pay for it upfront. Not only is the vehicle yours once the final payment has been made, unlike PCP, but you’re more likely to get car finance with a poor credit rating using HP.
But once you’ve got the car, what can you do with it? In this post, we’ll discuss whether you can modify a car on HP finance.
What is HP finance?
HP finance is essentially a deal where you borrow the money to pay for your car. As a result, you aren’t the owner until the deal is completed. Instead, it is the finance company who owns the car, which means they have a considerable say on whether you modify the vehicle.
Once the last payment is processed and your name is on the V5, you can do whatever you want (as long as the alteration is road legal).
Is there any way to modify a car on HP finance?
Yes – but you need to ask for permission first. If you don’t, you may void the terms of your agreement, and the finance company is entitled to ask you to pay the remaining balance in full. Alternatively, they may take the car back and sell it at auction. Should the car make less at auction that you owe to the finance company, you could then be liable for the balance.
By contacting the lender, either via telephone, email, or letter, you will eliminate any nasty surprises down the line. Make sure you get confirmation in writing. That way, you can prove you didn’t nullify the terms and conditions of the deal.
What are considered modifications?
Considered modifications on a HP finance deal can be anything that impacts the value of the car, whether positively or negatively.
Even the smallest modifications can have an impact on your finance agreement, so be careful not to make changes that haven’t been agreed with the lender.
Modifications could include, but are not limited to:
- Cosmetic changes to appearance, e.g., body kits, spoilers, paint, wraps, window tints, lights, wheels, etc.
- Upgrades in performance, e.g., suspension, exhaust, engine, brakes, gearbox, etc.
- Addition of towing equipment, e.g., towbar
- Infotainment systems, e.g., software, screens, speakers, stereos, etc.
So, don’t take the risk – speak to the lender. And of course, if it’s simply the case that you’re ready for a car with even more specifications, My Car Credit can help you with calculating and arranging car finance on your next wheels.
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