Hire purchase agreements remain a popular way to acquire home appliances. The current economic conditions mean most people look for financing options as an alternative to a cash purchase. The many benefits of hire purchase in comparison to other financing options make it a favorable option.
What is a hire purchase?
A hire purchase agreement is a purchase contract where a buyer pays a fraction of the appliance’s cost as a deposit. The remaining cost is thereafter paid in installments. These are equal amounts that one pays daily, weekly, or monthly. The installments attract interest and this makes the total cost of items higher than in a cash purchase. Only after payment of the last installment does the buyer become the owner of the items.
Hire purchase entitlement for the buyer
Hire purchase agreements in Kenya are regulated by the Hire Purchase Act. This means that the rights of the buyers as well as the seller are protected. Here is a look at the hire purchase entitlement for the buyers.
Rights of the buyer in a hire purchase deal
It is the duty of the seller to disclose the total price of the items to the buyer before signing the hire purchase deal. The total cost will include the deposit, the installments, as well as the interest. However, as a buyer, it is advisable to check the hire purchase agreement to check if there are hidden costs.
In the case of defects on the home appliances before delivery, the hire purchase buyer has a right to such information. In such cases, the seller pays for the repairs. However, if the home appliances suffer damage outside the warranty coverage after the delivery, the buyer pays for the repairs.
The hirer has a right to terminate the hire purchase agreement any time before the final payment. In such a case, the hirer will serve the seller a written notice of termination of the agreement and return the home appliances.
The hirer is entitled to accessing the items after signing the hire purchase agreement. It is the duty of the seller to deliver the products to the buyer. Leading hire purchase dealers such as Kenya Credit Traders deliver home appliances to a branch closer to the buyer making it easier for them to access the items.
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