With today’s economic situation, it is essential to find flexible and affordable ways to make expensive purchases. Assets such as cars, furniture, home appliances, electronics, and others are expensive especially when you want to make a cash purchase. One of the financing options that is popular among buyers is a hire purchase agreement. In this post, we will provide you with a hire purchase guide to equip you with knowledge before signing a hire purchase deal.
What is hire purchase on household furniture
A hire purchase contract allows a buyer to acquire expensive assets without paying the full amount upfront. Conversely, the buyer divides the cost into two parts: a downpayment, and installments. The downpayment is a fraction of the total cost, mostly as low as 15% of the total cost. The buyer pays the remaining cost in installments. These are regular payments and attract interest.
Advantages of buying your dream dining set on hire purchase
There are plenty of benefits a buyer enjoys by choosing hire purchase on household furniture. Here are some of the benefits.
• Hire purchase is budget-friendly
Hire purchase allows a buyer to spread the cost of furniture over time. Instead of paying a lumpsum amount, the buyer pays a fraction of the cost every day, week, or month. This makes hire purchases affordable and manageable. The repayment amount is fixed and doesn’t increase throughout the duration of the contract. This makes budgeting easier for the buyer.
• Flexibility
Another benefit of choosing a hire purchase agreement when purchasing a dining set is flexibility. The contracts are flexible and to suit the needs of the buyer. One has the chance to select terms that suit their financial situation.
• Ownership
Upon the buyer completing the payments, the seller will transfer the ownership title for the dining set to you. This is unlike leasing where one returns the assets to the seller, in a hire purchase deal, the buyer keeps the assets at the end of the agreement. This gives you the freedom to use, sell, or trade the dining set as you wish.
Key considerations when signing a hire purchase agreement
There are some factors to take into account when contemplating hire purchase.
• Interest rates: It is advisable to compare interest rates from different traders to secure the best deal. Take time to compare different deals and settle for the one that matches your financial goal.
• Down payment: The best hire purchase deal allows for an affordable downpayment.
• Repayment duration: There is a need to settle for a repayment period that aligns with your financial goals.
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