A hire purchase agreement is a legally binding contract between the buyer and the seller. Its primary purpose is to protect the seller as well as the buyer from exploitation. It is vital for both parties to take their time and understand the terms and conditions in the hire purchase agreements before signing. When you take your time to understand the details in the agreement, it is possible to find out any clauses allowing room for exploitation. The buyer also understands whether hire purchase is the right payment option to utilize.
Things to watch out for before signing a hire purchase agreement
- It is essential to keep in mind that a hire purchase will cost more than the cash price for any given product. This is due to the interest as well as administrative costs that one incurs.
- Always take your time to go through the hire purchase agreement. You should not sign any hire purchase agreement if you are not sure. Ask for a copy, take it home, and read. It is also advisable to seek advice. You can also compare the deal with other dealers.
- When there is information missing on the contract, one might not have to pay all the cost of the credit. The law requires the seller to provide all the necessary information to the hirer.
- Until you have made the last payment, you are not the owner of the products. This means that one cannot sell the products or even use them as security when borrowing. If you do, it will be a breach of the contract, and this can lead to the seller repossessing the goods.
Steps to take when cheated under a hire purchase agreement
The first step when one feels uncomfortable about the hire purchase agreement is to seek an audience with the seller. If the dispute can be settled between both parties, there will be no need for legal action.
One of the best ways to settle disputes that might arise from hire purchase agreements is to seek the services of a qualified lawyer. The lawyers will help you understand your rights. They can also help you draft a consumer complaint. Even in a case where one chooses to file a suit in a court of law, there is an arbitration clause. If arbitration doesn’t work for both parties, the case may be argued in a court of law.