Can you return a car on hire purchase?
Can you return a car on hire purchase?
You can cancel and return something you’re paying off through hire purchase at any time, but you might owe money to the company you bought it from. ‘Hire purchase’ is a type of borrowing where you agree to pay instalments on an item but you don’t own the item until you’ve paid off the agreement.
Do you have to pay half the hire purchase price?
Return the item to the owner and pay half the amount of the total hire purchase price (if the total of instalments already paid have not reached that amount). This is called the half-rule. You do not have to pay half the hire purchase price immediately. If you have not paid half the hire purchase price you can still return the item.
How does hire purchase finance ( hp ) work?
Hire Purchase (HP) is a finance product that allows you to budget accurately thanks to fixed interest rates and monthly payments. With HP you are effectively hiring the car until the end of your agreement, when with your final payment you purchase it and the car becomes yours.
How to calculate the real cost of a hire purchase agreement?
To calculate the real cost of a hire purchase agreement: For example: A garage offers two prices for the same car. The car will cost you €12,000 if you buy it outright with cash. Alternatively, the car will cost you €17,000 if you want to hire purchase the car:
Is it legal to end a hire purchase agreement?
The ‘half rule’ allows you to return the car and end the hire purchase agreement and limits your liability to half the hire purchase price of the car. This is a legal right under section 63 of the Consumer Credit Act 1995. Your agreement must show what half the hire purchase price is.
Return the item to the owner and pay half the amount of the total hire purchase price (if the total of instalments already paid have not reached that amount). This is called the half-rule. You do not have to pay half the hire purchase price immediately. If you have not paid half the hire purchase price you can still return the item.
What are the charges for a hire purchase agreement?
These fees and charges vary, but may include: Interest surcharge for missed repayments – this means an additional amount of interest will be charged on the amount unpaid Completion fee for ownership of the goods to pass to you – sometimes you have to pay a balloon payment much higher than your usual monthly payments
What happens if you break a hire purchase agreement?
Consumers should be aware that breaking a hire purchase contract before its normal end date usually involves penalties. You can either: Return the goods to the owner and pay half the amount of the total hire purchase price (if the total of instalments already paid have not reached that amount) – this is called the half-rule.
How is a hire purchase agreement ( HP ) regulated?
Hire Purchase is regulated by the Consumer Credit Act 1995. Some HP agreements have a balloon payment at the end of the agreement which is normally higher than your usual monthly payments You do not legally own the item until after the final payment is made, but you do have full use of the item throughout the payment period