Finance Agreement – Instalment Sale Agreement
This Instalment Sale Agreement has been designed for lending transactions where a lender finances goods (such as vehicles, equipment, office furniture etc) for people on an instalment sale basis. Provision is made for ownership in the financed goods to pass to the borrower once the loan has been repaid. The Pre-Proposal Quotation and Instalment Sale Agreement have been drafted with the National Credit Act in mind.
INSTALMENT SALE AGREEMENT
With a Pre-Agreement Proposal
(in terms of the NCA)
Summary A lender that finances goods (such as vehicles, equipment, office furniture etc) for people on an instalment sale basis may consider using this Instalment Sale Agreement. Provision is made for ownership in the Goods to pass to the borrower once the loan has been repaid. The Pre-Proposal Quotation and Instalment Sale Agreement have been drafted with the National Credit Act in mind.
The NCA-required Pre-Agreement Quotation is included with this document.
Why would I need an Instalment Sale Agreement? This Instalment Sale Agreement may be considered for use when a person finances goods for someone else, on the basis that ownership in the goods passes to the lender once the loan has been repaid in full. For example, computers, furniture, audio goods, vehicles etcetera. This Agreement provides for a loan that is repaid in instalments over a specific period, with regular payment obligations.
Before signing this agreement, the financier is advised to conduct a comprehensive financial and credit check on the borrower, and get the borrower to complete a separate application form for a credit facility.
What does the Instalment Sale Agreement say?
The Pre-Agreement Proposal covers the following issues: Description of goods; Finance details; Finance term; Instalments.
The Instalment Sale Agreement covers the following issues: Definitions; Suspensive Conditions; Sale of Goods; Delivery and Risk; Insurance; Security; Use; Fees and Charges; Interest; Instalments; Early termination; Customer warranties and undertakings; Default; Consents; Delivery address; General.
How long is the Instalment Sale Agreement? The Pre-Agreement Proposal can be printed onto three A4 pages, and the Instalment Sale Agreement can be printed onto ten A4 pages.
What do you need to do to use the Instalment Sale Agreement?
- Complete the relevant details in the Pre-Agreement Proposal and the Instalment Sale Agreement.
- Read the documents to ensure that they suit your requirements. Make changes as required.
- Ensure that the documents are signed by both the financier and the borrower.
This Agreement is intended for use in cases where the National Credit Act applies. While it has been drafted in accordance with our interpretation of the legislation, we recommend that you obtain independent advice before using an Instalment Sale Agreement. Agreements Online will not be liable for any damages you may suffer due to your non-compliance with any regulatory requirements.
Also known as: Sale Agreement; Hire-Purchase Agreement; Finance Agreement; HP Agreement
Also viewed: Financial Lease Agreement
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