If terminating hire purchase early, what must the customer do?

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Multiple Choice

If terminating hire purchase early, what must the customer do?

When you terminate a hire purchase early, you have the option to end the agreement by surrendering the vehicle and settling part of what you owe. The standard approach is to hand back the vehicle to the finance company and pay at least half of the total amount payable under the agreement. This is known as voluntary termination rights and reflects dividing the remaining cost between the lender and the early end of the contract. The vehicle should be returned in reasonable condition, with any excess wear or mileage charges considered as applicable. You don’t simply stop paying and keep the car, and there isn’t a separate fixed termination fee that replaces the payments.

When you terminate a hire purchase early, you have the option to end the agreement by surrendering the vehicle and settling part of what you owe. The standard approach is to hand back the vehicle to the finance company and pay at least half of the total amount payable under the agreement. This is known as voluntary termination rights and reflects dividing the remaining cost between the lender and the early end of the contract. The vehicle should be returned in reasonable condition, with any excess wear or mileage charges considered as applicable. You don’t simply stop paying and keep the car, and there isn’t a separate fixed termination fee that replaces the payments.

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