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Finance Options – Instalment Sale

This is an agreement between a buyer, a seller and/or a financial institution, used to purchase goods (like a vehicle), by making payment in instalments over an agreed period of time. The buyer is charged interest on the amount of the original price still to be paid, as well as other charges relating to the granting of credit.

Finance Options – Lease

This is an agreement between the dealership on behalf of a financial institution and a customer, in terms of which the customer is given use of the vehicle for an agreed lease payment amount over a fixed period of time. The customer must keep the vehicle for the full period and must pay the seller all the lease payments that are due over that period.

The customer normally has the right to terminate the agreement early by buying the vehicle from the seller at a stipulated price. At the end of the agreed period the customer must either buy the vehicle or extend the lease period or return the vehicle to the financial institution as per the agreement.