What the Consumer Credit Act 1974 does not cover?
The Act regulates consumer credit and ensures lenders provide customers with the following information before they enter a credit agreement
♦ Content and Form of credit agreement
♦ Method of calculating annualised percentage rate (APR)
♦ Procedures relating to events of default, termination or early settlement
♦ Section 75 of the Act protects you for credit card purchases between £100 and £30,000
What the Act does not cover?
The Act does not cover ‘unregulated’ debts such as:
♦ Certain types of business debts
♦ Debts to individuals such as mortgages, charge cards, household utility bills
♦ Debts to unlicensed lenders such as loan sharks
♦ Some credit union loan
Telephone or online credit agreements
The Act requires that certain information must be provided in good time before you are contractually bound.
The information provided must include the following:
♦ The name and address of the creditor
♦ Description of the main characteristics of the credit agreement
♦ The total price payable for the credit
♦ Arrangements for payment
♦ Information regarding a right of withdrawal.
Credit agreement cooling-off periods
You have the right to cancel such agreements (including those signed at a temporary marketing display stand) within the cooling-off period. Details of your cancellation rights must be included with the credit agreement. The effect of cancelling a credit agreement will result in any deposits being returned and may necessitate the return of purchased goods.
Unfair relationships and protecting borrowers
If you think an agreement is unfair, it can be challenged. The challenge must be based on unfair terms or how the lender has exercised or enforced any of their rights.
Once an allegation is challenged, the burden of proof shifts to the lender to prove that the relationship is fair.
Using Lestons as a mediator
Lestons have specialist staff to help should you have issues resolving a credit agreement. To create a case on this topic just click the link at the top of this page, our staff are ready and eager to assist you in any way possible.
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