Asset finance & hire purchase calculator

How this calculator works

With hire purchase your company pays a deposit, then fixed monthly payments, and owns the asset once the final payment (and any balloon) is made. The asset itself is the main security.

A balloon lowers the monthly payment by leaving a lump sum to pay at the end. You pay interest on it throughout, so the total cost is higher.

On hire purchase your company is usually treated as the owner for tax, so it can normally claim capital allowances. Ask your accountant how this applies to you.

The estimated monthly payment covers the amount financed, which is the asset cost less your deposit. Try changing one input at a time. A bigger deposit reduces both the payment and the interest. A longer term lowers the payment but adds interest. A balloon lowers the payment the most, but you still need the lump sum at the end, so plan how you will fund it before choosing one.

For illustration only: on £75,000 of equipment with a 10% deposit over 48 months at an example 8.5% a year, adding a 20% balloon (£15,000) brings the payment down from about £1,664 to about £1,400 a month. Total interest rises from around £12,360 to around £14,710, because part of the balance stays outstanding for the whole term.

Lenders look closely at the asset as well as the company: its type, age, expected working life and how easily it could be resold. New, mobile and widely used assets are often easier to fund than specialist or bespoke ones. When comparing quotes, check documentation and option-to-purchase fees, insurance requirements and what happens if you want to settle early. The calculator assumes fixed monthly payments and no fees.

Want to understand the product first? Read our guide to asset & equipment finance.