Hire purchase is a type of credit and way to finance buying a new or used asset. Under a HP agreement, you hire the machine and pay an agreed amount typically in monthly repayments.
The loan is secured against the asset meaning you don”t own the asset until the last payment is made.
The total amount you pay the finance company is the total HP which is made up of:
The cash price of the vehicle + Interest + Fees to setup and end the agreement.