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Instalment Purchase Agreement Template for Nigeria

A comprehensive legal agreement governed by Nigerian law that enables the purchase of goods through scheduled installment payments, where the seller retains title until full payment is made. This document incorporates requirements from the Nigerian Hire Purchase Act and related legislation, setting out payment terms, ownership conditions, parties' rights and obligations, warranties, and remedies. It provides protection for both seller and purchaser while ensuring compliance with Nigerian consumer protection and financial regulations.

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What is a Instalment Purchase Agreement?

The Instalment Purchase Agreement is a vital commercial document used in Nigeria when parties wish to structure the purchase of goods through regular payment instalments rather than a single lump sum. This agreement type is particularly relevant under Nigerian law, where it must comply with the Hire Purchase Act of 1968 and related legislation. It's commonly used for both business-to-business and business-to-consumer transactions, covering everything from vehicle purchases to industrial equipment. The document includes essential elements such as payment schedules, ownership rights, maintenance obligations, and default provisions, while incorporating necessary consumer protections required by Nigerian law. The agreement serves as a crucial tool for businesses offering financing options to their customers while maintaining security over the goods until full payment is received.

What sections should be included in a Instalment Purchase Agreement?

1. Parties: Identification of seller and purchaser with full legal names and addresses

2. Background: Context of the transaction and brief description of the arrangement

3. Definitions: Key terms used throughout the agreement including 'Goods', 'Purchase Price', 'Instalments', etc.

4. Sale and Purchase: Core terms of the sale including description of goods and total purchase price

5. Payment Terms: Details of instalment amounts, payment dates, and payment methods

6. Delivery and Acceptance: Terms regarding delivery of goods and acceptance procedures

7. Title and Risk: Provisions regarding transfer of ownership and risk in the goods

8. Seller's Warranties: Warranties regarding condition, quality, and fitness for purpose of goods

9. Purchaser's Obligations: Key obligations including maintenance, insurance, and usage restrictions

10. Default and Remedies: Consequences of default and available remedies for both parties

11. Termination: Circumstances and process for early termination

12. General Provisions: Standard boilerplate clauses including notices, amendments, governing law

What sections are optional to include in a Instalment Purchase Agreement?

1. Insurance Requirements: Detailed insurance obligations - required for high-value items or where specific risks need coverage

2. Security Provisions: Additional security requirements such as guarantees or charges - used for high-value transactions

3. Maintenance and Servicing: Detailed maintenance requirements - important for complex equipment or machinery

4. Import/Export Provisions: Required when goods are imported or may be exported during the agreement term

5. Third Party Rights: Needed when third parties (like guarantors or maintenance providers) have specific rights

6. Installation Requirements: Required for goods that need professional installation or setup

7. Training and Support: Include when seller provides training or ongoing support for complex equipment

What schedules should be included in a Instalment Purchase Agreement?

1. Schedule 1 - Description of Goods: Detailed specification of goods including make, model, serial numbers

2. Schedule 2 - Payment Schedule: Detailed breakdown of instalment amounts and payment dates

3. Schedule 3 - Delivery Details: Specific delivery instructions, locations, and timelines

4. Schedule 4 - Warranty Terms: Detailed warranty provisions and claim procedures

5. Appendix A - Form of Acceptance Certificate: Template for formal acceptance of goods

6. Appendix B - Maintenance Requirements: Detailed maintenance schedules and procedures if applicable

7. Appendix C - Insurance Requirements: Specific insurance coverage requirements and terms

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents

Jurisdiction

Nigeria

Publisher

Genie AI

Document Type

Payment Agreement

Sector

Banking

Cost

Free to use

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