When purchasing expensive items such as cars, appliances, and electronics, many people turn to hire purchase agreements to make the payments more manageable. A hire purchase agreement is a legal contract between a borrower and a financier where the borrower pays for the item over a set period of time with interest.
If you`re considering a hire purchase agreement, it`s important to understand the terms and conditions outlined in the contract. Here is a sample hire purchase agreement to give you an idea of what to expect:
This agreement is made on [date] between [borrower`s name] (hereinafter referred to as “the borrower”) and [financier`s name] (hereinafter referred to as “the financier”).
The financier agrees to sell to the borrower the following item: [description of item], for the total price of [total price].
The borrower agrees to pay the total price in installments over a set period of time, along with interest. The payment schedule is as follows: [payment schedule].
If the borrower fails to make any payment on or before the due date, the financier may, at its discretion, terminate the agreement and demand the return of the item.
The borrower acknowledges that the financier retains ownership of the item until the full purchase price and interest is paid in full.
The item is sold with a warranty provided by the manufacturer. The financier does not provide any additional warranty beyond the manufacturer`s warranty.
The borrower may terminate the agreement at any time by giving written notice to the financier. However, the borrower must pay the full purchase price and interest owed up to the termination date.
This is a basic sample hire purchase agreement. It`s important to note that the terms and conditions may vary depending on the lender and the item being purchased. Before entering into a hire purchase agreement, make sure you understand all of the terms and conditions.