Debt recovery and enforcement
Use of disabling devices on goods
Restrictions on lenders using car starter interrupters or other disabling devices
Some credit contracts allow the lender to attach a disabling device to goods that are subject to a security interest under the contract, so that the lender can then disable the goods remotely if the borrower gets behind on their payments. For example, the disabling device could be a starter interrupt device with a GPS locator that’s attached to a car bought on hire purchase.
However, lenders can’t attach disabling devices to the following types of goods: beds and bedding, stoves and other cooking equipment, medical equipment, portable heaters, washing machines and fridges.
Restrictions on when lenders can activate disabling devices
A lender can’t activate a disabling device unless:
- you’ve breached the contract in a way that, according to the terms of the contract, gives the lender the right to activate the device, and
- the lender has given you reasonable advance notice that they will activate the device, and has told you what you can do to avoid this.