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Consumer Credit Act 2006 (Right to withdraw (there is a right to withdraw…
Consumer Credit Act 2006
Regulated agreements
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consumer hire agreements
made by a person with an individual (the hirer) for the transfer of goods to the hirer which is not a hire purchase agreement and lasts for more than 3 months
limit £25,000 (incl rental agreements)
individual - incl partnerships or other unincorporated bodies not consisting entirely of bodies corporate
statutory requirements in relation to form and content:
- all the terms must be embodied in a legible written document, and the terms of cancellation must be included
- the agreement must be signed by the debtor or hirer in person and by or on behalf of the creditor;
- debtors must receive one copy of the agreement. For cancellable agreements, the second copy must be sent by post
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Right to withdraw
there is a right to withdraw from a credit agreement which applied to all consumer credit agreements except:
- agreements for credit exceeding £60,260;
- agreements secured on land;
- agreements for bridging loans in connection with the purchase of land
borrowers - right to cancel within 14 days from when the agreement was made. In writing, verbally or by electronic means
applies only to the credit agreement, does not give any right to return goods or cancel services which have been purchased using credit. Still obliged to pay for the goods/services.
hire-purchase/conditional sale/credit agreement - the customer can recover payments made. Must return the goods bu not obliged to deliver them. Can exercise a lien over the goods until they receive payment. Must take reasonable care of goods for 21 days after serving the cancellation. If goods are perishable - no obligation to return them, but must be paid for.
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