Features of Hire Purchase

Hire purchase is an option for those buyers who cannot pay the whole amount of his or her purchase. Hire purchase refers to an agreement where the buyer of a good can take goods on a monthly rental basis and once the rent equals original price of a good in addition to the interest then the buyer may exercise his or her option to buy the goods at a predetermined price or return the goods to the owner. Given below are some of the features of hire purchase –

1. The person who has hire the goods will give regular installment or rent to the owner of the good which will include some portion of principal amount and some portion of interest as agreed by both the parties.

2. The ownership of good passes only when the person has paid the last installment of the goods which he or she has hired.

3. Under hire purchase system the buyer can return the goods to the seller if he or she does not want to continue with the agreement.

4. In case of hire purchase the person who has taken the good on hire cannot transfer the goods to a third party as he or she does not have the ownership of the goods.

1 comment… add one
  • mybra

    You helped us a lot in our first semester exam

Leave a Comment

Related pages

positives of capitalismdefine demand depositsfeatures of autocratic leadership styleexamples of veblen goodsconglomerate mergerreceived advance payment journal entrynon redeemable preference sharesmarket skimming price strategyadvantages and disadvantages of globalizationgatt full formconservatism principle in accountingwhat is revenue expenditureselastic goods examplesunearned revenue accountingconsumer taste and preferencesnormal inferior goodscash inflow examplesnormal goods inferior goodswhat is complementary goodsunearned revenue journal entriesdupont chart analysiscrossing of cheque meansmateriality in accountingvertical merger examplesmerits and demerits of globalization wikipediacompetitive pricing strategy advantages and disadvantagesmeaning of regional rural banksdifference between overdraft and cash creditcompare socialism and capitalismexamples of upsellingcompetition based pricing advantages and disadvantagesadvantages and disadvantages of hire purchasedisadvantages of rural areasdecentralisation advantageswhat is demand loanfull form cfaskimming strategieseconomics substitution effectmeaning of capital rationingintraday transactionadvantages and disadvantages of environmental auditwhat is the bartering systemwhat are fictitious assetsconglomerate structureconglomerate organizationinferior goods economicsebit accountinghorizontal analysis accountingfifo methodsadvantage debit cardwhat does proprietors meanmeaning of skimming pricingmarket skimming examplesjit disadvantagesdisadvantages of marketing strategydisadvantages of advertswhat is the difference between monopoly and oligopolybackward integration strategy examplesdifferentiate between fixed cost and variable costdebturewhat are the disadvantages of globalizationtrade discount entryfluctuating exchange ratesdifference between accounts payable and receivablezero based budgeting advantages and disadvantageswhat is autocratic leadership stylelimitations of marginal costingmerits of marginal costingwhat are complement goodsdistinguish between explicit and implicit costcharacteristics of monopolistic competitionorder and bearer chequeadvantages and disadvantages of pricingdisadvantages globalizationdebit card wikiexamples of inferior goods in economicscarriage inward meaningfeatures of an oligopolydefinition of cost push inflationmixed market economy advantages and disadvantages