Under hire purchase agreement, when will the ownership of asset legally belong to the purchaser?

Under hire purchase agreement, when will the ownership of asset legally belong to the purchaser?
A . When the final instalment is paid
B. When the purchaser takes possession of the asset
C. When the down payment is made
D. When the agreement is signed

Answer: A

Explanation:

Hire purchase is an arrangement for buying expensive consumer goods, where the buyer makes an initial down payment and pays the balance plus interest in installments. Ownership is not transferred until the end of the agreement, hire purchase plans offer more protection to the vendor than other sales or leasing methods for unsecured items. That’s because the items can be repossessed more easily should the buyer be unable to keep up with the repayments.

The answer is ‘When the final instalment is paid’.

Reference:

– Hire Purchase Agreements

– CIPS study guide page 70 LO 1, AC 1.3