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Hire Purchase

Hire Purchase

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Hire Purchase

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  1. Hire Purchase

  2. What is to be learned? • What hire purchase is. • Advantages and disadvantages of hire purchase

  3. Hire Purchase • Buy over a period of time • Usually monthly payments • Also deposit (often 10%) You do not get your deposit back!

  4. Advantages • Get it straight away • Do not have to save up

  5. Disadvantages • Costs more usually* • May still be paying for it when it no longer is in use (broken, lost, fed up with it etc.) *Unless Interest free credit

  6. Basic Charlie buys a washing machine Cash Price £800 or HP - £80 deposit and 12 payments of £65. Payments = 12 X 65 = 780 Add deposit → 780 + 80 = £860 Dearer by £60

  7. Hire Purchase • Do not pay all at once • Pay deposit and monthly payments • Usually dearer

  8. Bike costs £240 cash or 15% deposit and 12 payments of £21 Deposit = 15% of 240 = 0.15 X 240 = £36 Payments = 12 X 21 = £252 Total = 252 + 36 = £288