A Balanced Payments agreement is designed to offer customers the benefit of linking their interest repayments to LIBOR (London Inter Bank Offer Rate) with the additional benefit of fixed monthly payments.
- The fixed term payments are calculated using an assumed or notional rate. This notional rate is set to provide a buffer between the notional rate and LIBOR which should more than compensate for subsequent rises in LIBOR over the term of the agreement.
- Current LIBOR is 0.54%
- Current Notional Rate is 2.00%
- On agreements written on Balanced Payments the customer is effectively over paying each month as long as the notional rate exceeds LIBOR. Even if LIBOR does eventually exceed the notional rate, the customer will have accrued a balance of overpaid interest against which any shortfall of interest would be offset.
- On HP deals, any overpayment situation at the end of the agreement, results in the agreement effectively finishing early, e.g. a 36 month deal may be fully paid by month 34.
- On Lease Purchase deals, any overpayment situation at the end of the agreement, results in a reduction in the balloon figure payable.
- All balanced payment deals are non-regulated.
- New cars
- Used cars (vehicles less than 3 years old and less than 60,000 miles)
- Terms available: 24-48 months
- Limited Companies,
- Partnerships (over £25k balance),
- Directors (over £25k balance),
- Sole Traders (over £25k balance)
- High Net Worth Individuals (over £25k balance)