What Is a Hire Purchase?

Hire purchase is a form of credit shopping. The buyer can obtain the goods first by installment, and after the payment has been paid, the goods can be officially owned. Some goods are more expensive, such as furniture, cars, etc. The seller usually allows the buyer to buy by hire. At present, the general operation mode of hire purchase is that the seller arranges for the buyer to purchase the goods from the financial institution, and then the financial institution signs the hire purchase contract with the buyer. In the hire purchase contract, it will be specified that the buyer must pay in installments within a specified period Payment. During the payment period, the buyer only rents the goods. After the lease expires, the buyer has the right to choose whether to purchase the goods according to the selling price specified in the hire purchase contract. When the buyer chooses to purchase and pay the purchase price, he obtains ownership of the goods.

Hire Purchase

Right!

Hire purchase is a form of credit shopping. The buyer can obtain the goods first by installment, and after the payment has been paid, the goods can be officially owned. Some goods are more expensive, such as furniture, cars, etc. The seller usually allows the buyer to buy by hire. At present, the general operation mode of hire purchase is that the seller arranges for the buyer to purchase the goods from the financial institution, and then the financial institution signs the hire purchase contract with the buyer. In the hire purchase contract, it will be specified that the buyer must pay in installments within a specified period Payment. During the payment period, the buyer only rents the goods. After the lease expires, the buyer has the right to choose whether to purchase the goods according to the selling price specified in the hire purchase contract. When the buyer chooses to purchase and pay the purchase price, he obtains ownership of the goods.

The hire purchase contract generally sets out the down payment paid by the buyer, the amount of each payment and the number of payable periods. Some goods can be interest-free instalments, and some are subject to interest. If the hire-purchased goods are for commercial use, their interest expenses can be deducted from tax. If the buyer wants to terminate the hire purchase contract early, the buyer must return the goods and follow the procedures specified in the hire purchase contract.

Examples of current successful hire purchases