Christmas on Credit – Know Your Rights

It is estimated that Britons will spend, on average, over £450.00 each on presents at Christmas. To spread the cost many will buy presents on credit and will not know what their rights are.

The Consumer Credit Act covers most commercial lending in the UK. It sets out what lenders must do when they lend money and your rights when borrowing.

Tom Sedley, Dispute Resolution Specialist at Butcher & Barlow’s Bury office, provides a summary of your rights when purchasing through credit.

What does the Consumer Credit Act Cover?

The Act covers most household borrowing including credit cards, store finance, catalogues and payday loans.

What should I be told before entering into a credit agreement?

You should be told about the amount of credit and/or credit limit, the duration of the agreement, the interest charges and the APR, the total amount repayable and when your payments are due.

Both you and the lender should sign the agreement and you must be given a copy of the agreement on the date it was signed or within 7 days.

I do not want the credit anymore, what can I do?

You have 14 days from when you signed the agreement to cancel a credit agreement

If I cancel the credit, what happens to the goods?

If you have received any goods then you will need to return them or find an alternative way to pay for them and if you have borrowed money you will have to repay it along with any interest which has been charged up to the point of cancellation.

I pay for most things on Credit Card, is there any other additional protection?

Yes, provided the amount purchased on the credit card is between £100 and £30,000. If you have a claim for breach of contract or misrepresentation (i.e. where the goods are not as described or are not delivered) against a company, you can ask your credit card provider to reimburse you the amount paid. You can also ask for the credit company to reimburse you if the retailer has gone bust. 

This applies even if you only pay a portion of the full cost on a credit card, for example a car/holiday deposit (provided that this amount is above £100). 

This applies to goods bought online, from abroad, over telephone or by mail order.

However strong your legal protection, if the credit provider has not or will not obey the rules, you should seek legal advice on how best to resolve your dispute.

For more information, or to discuss a specific query, contact Tom Sedley on 0161 764 4062 or email tsedley@butcher-barlow.co.uk

Butcher & Barlow LLP

Butcher & Barlow have a team of Dispute Resolution specialists who are happy to assist whatever your circumstances. Please do not hesitate to get in touch via enquiries@butcher-barlow.co.uk or email your legal adviser directly.