Credit and debt

Your rights and obligations when you borrow money

What this chapter covers

This chapter includes information about the following:

  • Credit contracts: Hire purchase, loans and other credit – This section explains:
  • the new “lender responsibility principles”
  • the information you must be given by the lender (or “creditor”)
  • your rights to cancel the credit contract
  • interest and credit fees
  • when and how you can challenge an unfair credit contract
  • rules about repayment, including when you can ask the lender or the courts to relax the contract terms because of unforeseen hardship.
  • Guarantors – This section describes guarantors (people who agree to be responsible for someone else’s debt) and the rules and protections that apply to them.
  • Debt recovery and enforcement – This section explains how lenders can recover debts through debt collection agencies and through the courts. It includes information about:
  • how you can dispute that you owe a debt
  • how agencies can report on your credit history
  • your rights against debt collection agencies
  • rules that say when and how your property can be seized (“repossessed”) to pay off a debt (this property could be either hire-purchase goods or goods that you’ve put up as security for the loan).
  • When you can’t pay your debts: Bankruptcy and other options – this section explains bankruptcy and also two other processes: the no asset procedure and summary instalment orders.

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