HP purchase and credit agreement

[Phonesurgeon]

Hi folks can someone please explain to me whats the difference between hire purchase and creedit agreement regarding the purchase of a car from a motor dealer. thanks

[lbl]

Probably best to have a look at this link, which explains the different types of Credit

 

Hope this helps

[Phonesurgeon]

thanks lbl that opened my eyes.

i think when i bought my car i thought i had a hire purchase agreement, reading that i more than enough sure that i have a credit agreement for the car. unfortunately i cannot speculate anymore on that as i cannot locate the document...

[scarlett79]

Hi we had a car think it was hire purchase anyway a remaining balance of £1000 turned into £6000 due to charges and so on, do you know if we can claim any of this back like bank charges, using the same templete letters and so on, or can this not be done? thnx.

[Phonesurgeon]

scarlett that was my plan of action but as i cannot locate my agreement this has to wait. i am not too sure about the charges so please don't quote me on this.

Maybe somebody else with more info could add to this?

[rosiecotton]

There are quite a lot of differences between HP and credit agreements. The site linked is useful for explaining the basics.

 

HP - you do not own the car. It belongs to the HP company until it is paid for. You can not sell the car without permission from the HP company as it is not yours to sell until you have paid for it. You can voluntary terminate the agreement and hand the car back. You have entirely different statutory rights - instead of claiming under the Sale of Goods Act against the dealer, you claim under the Supply of Goods (Implied Terms) Act against the finance company. This is because you effectively do not have a contract with the dealer where you purchased the vehicle. The dealer sells to the finance company, which then hires it to you. Therefore your contract is solely with the finance company.

 

Credit - you own the car and effectively have a loan to repay. You cannot voluntary terminate the agreement. You can however sell the car and ask for a settlement figure for the loan. Your statutory rights are twofold - against the dealer under the Sale of Goods Act and also against the finance company under Section 75 of the Consumer Credit Act (provided the finance was arranged by the dealer). Your contract for the car is with the dealer.

 

 

With regard to charges, I would assume that the charges on these agreements should also only be to cover their costs and should not be extortionate, I do not see any reason why these would be any different from bank charges and the like. I'm no expert on bank charges though (I'm really here for the consumer forums ) so someone else might come along to either agree or disagree with me

[jjandbump]

I am wantiung to claim back the charges on our account.

 

We have an agreement with the Royal bank of scotlands sister compnay capital bank plc, we got the car about 18 months ago BUT have the same to go on it.

 

We have been charged extaushantly and some months £100.00 where they have sent 4 letters 2 days apart, charging £25.00 per letter.

 

this has not always been our fault either they have failed to update details etc. But they saidthey would terminate the agreement if we didnt pay them.

 

So my question is can they shut the agreement down if i claim all of this back, and take the car away, we dont have a brilliant credit record and probably wouldnt get finance again that easily, besides which we dont want to loose the £5000 we have already paid in to the agreement.

 

Any advise would really help