A retail installment credit agreement is a binding contract entered into by a borrower and a creditor. These agreements are commonplace for credit cards, furniture store loans and even small personal loans.
Significance
A retail installment agreement contract is a legal document holding a borrower liable for the payment of goods and/or services extended to him prior to paying for the items or service in full.
Protection
Installment agreements are meant to protect merchants from loss. For example, most car loans are an agreement to make payments in regular monthly installments until the amount of the loan is satisfied. Should a borrower fail to do so, the merchant has the right to repossess the collateral.
Time Frame
Retail installment contracts include the time frame for payments, payment dates and amounts and the maturation date for the loan. The contract will also provide details pertaining to late payments, fees or charges if the borrower violates the contract.
Considerations
Prior to entering into any legal agreement a borrower should read the fine print carefully and if she is uncertain about any portion, have it reviewed by a legal professional prior to signing.
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