HP Balloon is a type of HP agreement for businesses, which lets customers spread the cost of their vehicle over 36 to 48 months. The final balloon payment makes the monthly repayments lower compared to a regular HP agreement. At the end of their agreement, customers can choose to retain or replace the vehicle.
Good for business customers, if:
• they want to free up cashflow for their business and want lower monthly repayments in comparison to a HP.
• they want to spread the repayments over 36 to 48 months.
• they’re happy to pay a larger balloon payment at the end of their agreement if they keep the vehicle.
• they’re a limited company and want to claim monthly interest (tax deductible interest), offset wear and tear costs against taxable income and deduct capital allowances from taxable income.