Hire Purchase Agreement

A Hire Purchase Agreement is a financing arrangement that allows you to buy an item, such as a car or appliance, through regular payments over time. You initially rent the item with the option to purchase it at the end of the payment period. During this time, you make installments that cover both the item's cost and interest. Until you've made all payments, the ownership remains with the seller or finance company. Once you've completed all payments, the item officially becomes yours. This arrangement makes it easier to afford expensive items by spreading the cost over manageable installments.