Malaysia Financial Law - Buying On Hire Purchase

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FINANCIAL LAW - Buying On Hire Purchase

Related Topics : Banking Law . Offshore Banking Law . Broker Disputes . Commodities Law . Investment Terms . Raising Capital . Securities Law . Buying On Hire Purchase . Exchange Control Rules . Danaharta Act

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WHAT IS HIRE PURCHASE ?

It is a system of buying things on credit whereby the seller of the goods is regarded as the dealer, the purchaser is regarded as the hirer and the finance company is the owner. The ownership of the goods bought on hire purchase does not pass to the hirer at the time of the hire purchase agreement or upon delivery of the goods. The ownership of the goods remains in the owner until the hirer has fully paid the price agreed upon in the hire purchase agreement.

WHAT GOODS CAN I BUY ON HIRE PURCHASE ?

You can buy all consumer goods on hire purchase as well as motor vehicles such as invalid carriages, motorcycles, motor cars including taxi cabs and hire cabs, good vehicles where the maximum permissible laden weight does not exceed 2540 kilograms, and also buses including stage buses.

WHAT DOCUMENTS MUST I SIGN WHEN I BUY THINGS ON HIRE PURCHASE ?

All the parties must sign a hire purchase agreement and the agreement, among other things, must specify the date when the hiring commences, the number of instalments, the amount of each instalment, the time for the payment of each instalment, the description of the goods and where the goods are kept. Note that the agreement must be in writing. An oral agreement is not a valid hire purchase agreement.

SHOULD I SIGN A BLANK AGREEMENT FORM ?

Under no circumstances should you sign a blank hire purchase agreement form.

DO I NEED A GUARANTOR ?

The owner may require you to furnish information on or more guarantors to guarantee the performance of your obligation under the hire purchase agreement.

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