Hire purchase is acquisition of assets on credit on credit and settlement of which is made through regular installments payments. its the provision of finance for assets or equipment which is repaid by instalments over a period of time in accordance with the contractual agreement which is entered into from the out-set.
How can I get a higher car purchase in Lagos?
How can I get a hire purchase car in Nigeria?
- Fill out our online application form in details.
- Get pre-verified. Provide proof of income/ evidence of salary domiciliation.
- Start Payment of N150,000.
- Pick the car you want from any of our approved dealer partners.
- Sign and drive away!
How do you do hire purchase?
How hire purchase works. Usually, you’ll first need to put down a deposit on the car you want to buy. For most hire purchase agreements this will be 10% or more of the vehicle’s value. The rest of the value of the car will then be paid off in instalments over a period of 12 to 60 months (one to five years).
What is hire purchase agreement?
A hire purchase (HP) agreement is a credit agreement. You hire an item (for example, a car, laptop or television) and pay an agreed amount in monthly payments. You do not own the item until you have made the final payment. Personal Contract Plans (PCPs) are a type of hire purchase agreement.
How does hire purchase work in Nigeria? – Related Questions
What are the disadvantages of hire purchase?
Disadvantages of hire purchase
- The loan is secured against the vehicle. With a hire purchase agreement, you’re in a fixed contract.
- It will cost more overall.
- Monthly payments are based on credit rating.
- It can be expensive for short term agreements.
- Missing or late payments could affect your credit score.
Can I sell my hire purchase car?
Can I sell a car with outstanding hire purchase (hp) finance? In the case of a hire purchase, you cannot sell the car until the loan is repaid because the lender is the vehicle’s legal owner until the last payment is made. The only way to sell such a car is to repay the loan early.
What is the benefit of hire purchase?
The primary financial benefits for a company using a hire purchase plan include maximizing working capital, the ability to enhance the financial appearance of the company to investors and the potential of payment flexibility.
Why is hire purchase agreement important?
Hire purchase agreements are used to assist buyers in purchasing expensive products or services. It allows an asset’s cost to be spread over time with an initial down payment, followed by periodic installments plus any accrued interest.
What is difference between hire purchase and lease?
Hire purchase payments are usually lower than leasing payments, as the buyer only pays for a portion of the asset’s value each month. Hire purchase agreements often come with balloon payments, a lump sum payment made at the end of the hire period. This can make it easier to budget for the purchase of the asset.
What are the types of hire purchase agreement?
Hire-purchase agreements are of two forms.
- In the first form the goods are purchased by the financier from the dealer and. the financier obtains a hire-purchase agreement from the customer,
- In other form. the customer purchases the goods and he executes a hire-purchase agreement with a financier,
Can you pay off hire purchase early?
With hire purchase (HP), you can return the car early if you’ve already paid for at least half of its cost or make up the difference between what you’ve already paid and half of its cost. If you’ve already paid more than half the car’s cost, you won’t receive a refund of the difference.
Can you cancel a hire purchase agreement?
You can end (terminate) a hire purchase or conditional sale agreement in writing and return the goods at any time. This can be useful if you can no longer afford the payments or you don’t need the goods any more. You will have to pay all the instalments due up to the time you end the agreement.
How can hire purchase be terminated?
8 of the Hire Purchase Act, provides the procedure for terminating a hire purchase agreement by the hirer. Specifically, according to S. 8(1), in order for a hirer to terminate the agreement, he has to send a notice in writing to the person entitled or authorised to receive any sums payable under the agreement.
What are the rights of hire purchaser?
Right of hirer to purchase at any time with rebate. Right to hirer to terminate agreement at any time. Right to hirer to appropriate payments in respect of two or more agreements. Assignment and transmission of hirer’s right or interest under hire-purchase agreement.
What happens to a hire purchase agreement when someone dies?
If you have a personal contract purchase (PCP), hire purchase (HP), personal loan or any other kind of borrowing to finance your car, that debt remains payable even in the event of your death.
Who is the owner in hire purchase agreement?
In a hire purchase agreement, ownership is not transferred to the purchaser until all payments are made. Hire purchase agreements usually prove to be more expensive in the long run than purchasing an item outright.
What is cash price in hire purchase?
(iii) Cash Price: Cash price or cash value of an asset is the price payable on the outright purchase of that asset. (iv) Down Payment or Advance Payment: Cash down payment, down payment or advance payment means the advance paid or the cash payment made at the date of signing the hire purchase agreement.
Can HP car be repossessed?
If you cannot afford to pay
If you fall behind with your payments on a hire purchase or conditional sale agreement, the creditor may be able to repossess the goods.
What is hire purchase loan?
Hire purchase (HP) or leasing is a type of asset finance that allows firms or individuals to possess and control an asset during an agreed term, while paying rent or instalments covering depreciation of the asset, and interest to cover capital cost.
Can you buy a car and pay monthly?
Hire purchase is a way of buying a car on finance, where the loan is secured against the car. You’ll need to pay a deposit of around 10%, then make fixed monthly payments over an agreed time period. This means you don’t own it until the last payment has been made.