On a Lease Purchase (LP) an amount of the total cost of the vehicle will be deferred (estimated future resale value/ residual value) until the end of the agreement. Your monthly payments will be based on the total cost less the deferred amount. The deferred payment must be paid at the end of the agreement to own the vehicle.
On a LP agreement the deferred element (residual value/final payment) is estimated based on the vehicle usage, meaning the vehicle could be worth less than the lenders estimation which could result in negative equity.
The difference between a Lease Purchase and a Personal Contract Purchase PCP is that the deferred payment on a Lease Purchase is an estimate of how much the car maybe worth, where as on a PCP the Guaranteed Minimum Future value (GMFV) is the minimum the car will be worth and there is no option to return the car.
Jigsaw Finance Limited is a credit broker and not a lender. We can introduce you to a limited number of lenders and their finance products. We are not an independent financial advisor; we will provide details of products available, but no advice or recommendation will be made. You must decide whether the finance product is right for you.
Whichever lender Jigsaw Finance Limited introduces you to, we will typically receive commission from them (either a fixed fee or a fixed percentage of the amount you borrow).
All of the lenders that Jigsaw Finance Limited work with could pay commission at different rates and the commission values could vary between finance products, but the commission we receive does not influence the interest rate you will pay. Jigsaw Finance Limited's aim is to secure finance for you at the lowest interest rate available from our panel of lenders.