Lipa pole pole in hire purchase deals is becoming a common feature in Kenya. More consumers are choosing hire purchase deals to acquire household items such as furniture, electronics, kitchen appliances, and building materials.
How Hire Purchase Works
Lipa pole pole involves paying a down payment to acquire items. The down payment can be set at as low as 15% of the total value of the assets. The total cost is realized by breaking down the remaining balance into equal installments. The installments attract interest, thus making the total cost higher than a cash purchase. The ability to spread the cost is however the biggest benefit of choosing a lipa pole pole deal.
Managing Payments in Hire Purchase Agreements
The buyer acquires assets immediately they make a down payment and sign the hire purchase contract. However, they do not acquire the title from the dealer immediately. The title is only transferred at the end of the agreement. This is after the buyer pays all the installments. It is thus important to keep up with the payments. Late payments and defaulting on the payments will lead to repossession by the seller. In a case where the dealer repossesses the assets due to default, the buyer loses all the payments they had made to that point.
How To Manage Payments
The first step towards managing payments in a lipa pole pole deal is when one is signing the hire purchase contract. The hire purchase deals are flexible, making it possible to settle for a deal that suits your needs. Finding a hire purchase package that works for your income is imperative. One has the chance to choose a longer contract with lower monthly payments. This will ensure that every month you pay a small fraction of the cost to the dealer, leaving you with enough cash to spend on your other expenses.
To avoid running into a hire purchase debt, you might need to restructure the hire purchase contract with the dealer. Rather than run into late payments or defaulting, you can always contact the hire purchase company and restructure the agreement. In the case where your financial life faces changes, it is imperative to work out the repayment formula with the dealer in advance.
Learn more about hire purchase deals at Kenya Credit Traders.
