When it comes to purchasing high-value items such as cars, electronics, or even furniture, many consumers choose to opt for a hire-purchase agreement. This type of agreement allows individuals to pay for their purchases over time, making it easier to afford expensive items without having to pay the full cost upfront.
However, not everyone is aware of their statutory rights as a hirer under a hire-purchase agreement. To help you understand your legal rights as a consumer, we’ve compiled a comprehensive guide to the statutory rights of hirer under hire purchase agreement.
Under the Consumer Credit Act 1974, all hire-purchase agreements are required to include a specific set of statutory rights, which are designed to protect the rights of the consumer. These include:
1. Right to terminate the agreement
As a hirer, you have the right to terminate your hire-purchase agreement at any time before the final payment is due, without having to pay any additional fees or charges. This right is in place to protect consumers in case they are unable to continue making payments on their purchases.
2. Right to early settlement
If you want to pay off your hire-purchase agreement early, you have the right to do so. The lender is required to provide you with a statement showing the original amount of credit, the amount paid, and the current amount outstanding. If you decide to settle early, you may be entitled to a rebate of interest.
3. Right to return the goods
If you have paid off at least one-third of the total amount payable under your hire-purchase agreement, you have the right to return the goods without any further liability. However, you may be liable for any damage to the goods or any missing parts.
4. Right to repair or replacement
If the goods you have purchased under a hire-purchase agreement are faulty, you have the right to have them repaired or replaced. The lender is responsible for covering the cost of repairs or replacements, up to a certain point.
5. Right to receive a copy of the agreement
Under the Consumer Credit Act 1974, all hirers are entitled to receive a copy of the hire-purchase agreement. This document should outline all of the terms and conditions of the agreement, including the total amount payable, interest rates, and any additional charges.
By understanding your statutory rights under a hire-purchase agreement, you can protect yourself as a consumer and ensure that you are not taken advantage of by lenders. If you have any questions or concerns about your hire-purchase agreement, it is always best to seek advice from a legal professional.