Question

Which of the following statement(s) is / are true regarding Lease Agreement (LA) and Hire Purchase Agreement (HA)?

• A. In LA the ownership of the asset will be transferred after the last installment is paid.
• B. In HA the ownership of the asset will be transferred after the first installment is paid.
• C. In LA the ownership of the asset will be transferred after the first installment is paid.
• D. In HA the ownership of the asset will be transferred after the last installment is paid.
• E. Both (A) and (B) above

Answer 1

The correct option is D In HA the ownership of the asset will be transferred after the last installment is paid.

In hire purchase, the ownership will be transferred to the buyer after all the hire purchase installments are paid.