Example: John's delivery service
John is looking to purchase a new vehicle for his delivery service business. His cash flow won't allow for him to buy a new vehicle, so he wants to know how much his repayments will be with a commercial hire purchase. Using the CHP calculator, he enters the following amounts:
- Loan amount: $10,000
- Loan term: 3 years
- Residual: 15% ($1,500)
- Interest rate: 8% p.a.
He can see that his monthly repayments will be $274.53. Wanting to save some money, he sees what would happen if he made weekly repayments. Using the calculator, he can see that his weekly repayments would be $63.35, which would be approximately $20 less a month than if he made monthly repayments.
* This is a fictional, but realistic, example.