Hire-purchase definitions
| Word backwards | esahcrup-erih |
|---|---|
| Part of speech | Noun |
| Syllabic division | hire-pur-chase |
| Plural | The plural of "hire-purchase" is "hire-purchases." |
| Total letters | 12 |
| Vogais (4) | i,e,u,a |
| Consonants (5) | h,r,p,c,s |
HIRE-PURCHASE, also known as installment plan, is a method of buying goods in which a down payment is made, followed by equal installment payments over a set period of time.
How Hire-Purchase Works
In a hire-purchase agreement, the buyer does not own the goods until the final installment payment is made. The seller or lender retains ownership of the goods until they are fully paid for. This allows individuals to acquire expensive items such as appliances, furniture, or vehicles without having to pay the full purchase price upfront.
Benefits of Hire-Purchase
One of the main benefits of hire-purchase is that it allows individuals to spread the cost of a large purchase over time, making it more manageable for their budget. Additionally, hire-purchase agreements typically do not require a large upfront payment, making it accessible to individuals who may not have the funds to pay in full upfront.
Risks of Hire-Purchase
One potential risk of hire-purchase is that the buyer may end up paying more for the goods compared to buying them outright. This is because hire-purchase agreements often include interest charges or fees. Additionally, if the buyer misses payments, they risk losing the goods and the money they have already paid towards them.
Conclusion
In conclusion, hire-purchase can be a convenient way for individuals to acquire expensive items without having to pay the full purchase price upfront. However, it is essential for buyers to carefully consider the terms of the agreement and ensure that they can afford the installment payments to avoid any financial difficulties.
Hire-purchase Examples
- Sarah decided to finance her new car through hire-purchase.
- The furniture store offers hire-purchase options for customers on a tight budget.
- John used hire-purchase to acquire a new laptop for his graphic design business.
- Hire-purchase agreements typically involve a down payment followed by monthly instalments.
- The company purchased a fleet of vehicles through a hire-purchase arrangement.
- Many people opt for hire-purchase when buying pricey items like appliances or electronics.
- The bank approved the hire-purchase application for the construction equipment.
- The customer signed a hire-purchase agreement for the latest model of the smartphone.
- Small businesses often rely on hire-purchase to acquire necessary equipment without significant upfront costs.
- The store owner decided to offer hire-purchase as a payment option to attract more customers.