help understanding mobility scheme (hp part)

edited 30 November -1 at 1:00AM in Disability Money Matters
13 replies 1.8K views
claire1234claire1234 Forumite
693 Posts
edited 30 November -1 at 1:00AM in Disability Money Matters
hiya everyone,

my hubby recieves LRC and HRM for dla, this is for a indefinate period.

our car has completely given up on us,
can someone please in simply terms explain to me the hire purchase side of the mobility scheme?

am i right in thinking:
on hp at the end of the amount of years the car is his to keep?
at the end of the years his benefit money returns to normal?

looking at the table if he choose a car for 3k over 3 years the payment would be £100 per month and what is left over from his benefit he still gets?

on hp can he go out and choose the car from anywhere?

help please, im confused!
thanks everyone.
«1

Replies

  • Yes, after 'paying off' the car it is yours to keep. You also keep any DLA not used for the HP loan and get full DLA once the car is paid for.

    The downsides with Motability HP are:

    You have to buy the car from a motability dealer and there are some age and mileage limits on the cars you are allowed to buy.

    Also the percentage interest rate is very high - it works out much cheaper at a high street bank etc. Also with a bank loan you are free to get any car you want from anywhere.

    Tally
  • thank you tally,

    what about tax and insurance and everything?
  • http://www.motability.co.uk/main.cfm?Type=CPFC
    you have to insure and tax the car yourself plus service, roadside assistance etc.

    This sounds alot but is ofset by the fact you will have equity in the car.
    dont forget if the car is only used for your husbands 'benefit', he can get free road tax (get a certificate of road tax exemption from DWP) and that roadside assitance is often free with bank accounts or really cheap with quidco etc.

    Personally I found it was better to buy my car on a 0% credit card and use martins card tarting system as I think the motability HB rates are pretty steep compared to other sources of finance unless your credit is bad (although as money gets harder to borrow they may look more favourable). Many car manufacters are desperate and are running 0% deals, as are many dealerships
    .
    Its also worth remembering that many dealers have their own disability discounts scheme (ask someone senior who knows what they are talking about as many of the salemen wont have heard of it).
  • hiya,

    thanks, god its all confusing isnt it!

    yes he has the free tax disc ( i dont drive, its his car.)

    so if he got a hp car he would still get his tax disc but would have to pay for insurance & breakdown (and any other things like that)?

    thanks for all your help :)
  • yes, the tax disc is a legal entitlement not anything to do with motability.

    Obviously you will have to price up insurance (use martins article to get the best price) service, mot and any repairs (best to budget for these over the year). breakdown (again martin has an article on this and I started a disabled breakdon thread a whole ago).

    eg this year I have paid:
    insurance -£300 (I only passed my test last year so a bit pricy)
    breakdown - gree flag roadside, home, onward travel etc. £39 (specal offer with my insurance)
    service -£125 (bit of a rip off as I wanted to use authorised dealer)
    new tyre - £49 plus vat

    work out how much interest you will pay over the period of the agreement and then work out if you would be better off to have gone it alone.
  • thank you so much :)
  • allydowdallydowd Forumite
    4.9K Posts
    Part of the Furniture 1,000 Posts Name Dropper Photogenic
    ✭✭✭✭
    In legal terms the car will be yours once you have paid the final instalment if the paperwork you have describes the payment arrangement as "hire purchase".

    Ally
    (Association of Accounting Technicians)
    Debt-free day: 8th May 2015
    The Joy Account: £1400

    "Remember that sometimes not getting what you want is a wonderful stroke of luck," Dalai Llama
  • gregg1gregg1 Forumite
    3.1K Posts
    Part of the Furniture 1,000 Posts Combo Breaker
    ✭✭✭✭
    nanokitten wrote: »
    http://www.motability.co.uk/main.cfm?Type=CPFC
    you have to insure and tax the car yourself plus service, roadside assistance etc.

    This sounds alot but is ofset by the fact you will have equity in the car.
    dont forget if the car is only used for your husbands 'benefit', he can get free road tax (get a certificate of road tax exemption from DWP) and that roadside assitance is often free with bank accounts or really cheap with quidco etc.

    Personally I found it was better to buy my car on a 0% credit card and use martins card tarting system as I think the motability HB rates are pretty steep compared to other sources of finance unless your credit is bad (although as money gets harder to borrow they may look more favourable). Many car manufacters are desperate and are running 0% deals, as are many dealerships
    .
    Its also worth remembering that many dealers have their own disability discounts scheme (ask someone senior who knows what they are talking about as many of the salemen wont have heard of it).

    My brother is just in the process of getting a motability car on the contract hire and the tax is not applicable (exempt), insurance (20,000 pa plus 1 additional driver), servicing, tyres are all covered in the payment.

    Sorry - ignore my post - just read the thread properly (!) and realised you are talking about HP not contract hire (its been a long day!)
  • am i right in thinking on contract hire he could nominate me to drive and that would be ok but on hire purchase i cannot even tho we would be paying all insurance ourself?

    just trying to get it all sorted in my head, :)
  • claire1234 wrote: »
    am i right in thinking on contract hire he could nominate me to drive and that would be ok but on hire purchase i cannot even tho we would be paying all insurance ourself?

    just trying to get it all sorted in my head, :)


    Hi,

    On the Leasing Scheme, 2 drivers can be nominated free of charge (which can include the 'hirer') You can pay extra to have extra drivers put on the policy. There are some age restrictions though.

    With HP the purchaser is responsible for getting insurance and can insure however many drivers they like subject to the policy obtained.

    Tally
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