Understanding How Hire Purchase Works In Kenya
What is hire purchase?
Hire purchase is one of the payments methods available in the modern Kenyan market. If you are looking to purchase appliances, furniture, electronics, and other expensive assets for your home, the price might be a bit high. This means that one might be unable to purchase such products and pay all the required cash at once. Hire purchase allows you to pay a fraction of the total amount initially, known as a deposit or down payment. You will pay the remaining balance within a set duration, and in various installments. The deposit is paid initially when the product you require is delivered.
How Does A Hire Purchase Agreement Contract/Agreement Work?
If you opt to purchase a certain asset for your home using a hire purchase agreement, you will be required to pay the deposit but not the whole price. After paying your deposit, you will have the right to use the asset. However, the ownership of the asset remains with the seller. After one pays the down payment, one will need to pay the set installments with interest. The terms and conditions relating to the period of repayment are decided before one signs the agreement. The ownership of the appliance, furniture, or electronics will only be transferred when one completes paying the installments. This means that the asset can be repossessed by the seller if the buyer fails to pay the installments.
Types Of Hire Purchase
Hire purchase is usually divided into two categories
- Industrial hire purchase: In this case, the assets are purchased by a company or a business. This usually involves purchasing high-end machinery.
- Consumer high purchase: Kenya Credit Traders Limited specializes in this type of high purchase. It usually involves a consumer purchasing personal assets to furnish their home. Whether you need furniture, electronics, kitchen appliances, or other essential assets, this is the ideal payment method.
Visit our site to view products available on hire purchase terms.