Credit contracts: Hire purchase, loans and other credit
Problems with goods and services bought on credit
Goods or services bought on credit have to comply with the general consumer-protection laws. This means you have the following rights:
- Substantial defects – If there’s a problem with the goods or services that can’t be fixed or that amounts to what the Consumer Guarantees Act calls “substantial” defects, you can cancel the credit contract and the lender must return all the payments you’ve made. (For more details, including when a defect is “substantial”, see “Automatic guarantees when buying from a business” in the “Consumer protection” chapter).
- Less serious defects – If the defect with the goods or services can be fixed and doesn’t amount to a “substantial” defect, you’ll need to give the supplier an opportunity to fix the problem, and you must keep up the payments on the credit contract. If you stop your payments and it’s a hire-purchase contract for goods, the lender may be able to repossess the goods (see “Repossession” in this chapter). If the supplier doesn’t fix the problem within a reasonable time, you can cancel the credit contract and the lender must return all your payments.