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.