Reclaim Hire Purchase Charges
However, just as many people have been missold loans in recent years. There have also been problems with hire purchase agreements giving people reason to look to reclaim hire purchase charges.
The key difference between a hire purchase sale and a straightforward buy sell scenario is that the customer does not actually own the bought product until it is fully paid off. The characteristics of a hire purchase sale are as follows:
- The goods do not legally belong to the customer until all payments have been made
- The finance company, not the retailer, owns the goods until the final payment is made
- If payments are not completed, the finance company can seize the goods
- The customer is liable for any damage caused to the goods until final payment is made
In a hire purchase agreement, an initial deposit is paid for the product and the rest of the payments are spread over a period of time. The repayments will also include an interest amount added to the final price.
If you have taken out a hire purchase agreement in the last six years, you may have the right and even the need to contact solicitors for the purpose of looking to reclaim hire purchase charges.
There are two instances in which you may be able to reclaim hire purchase charges. Firstly, if you paid off the hire purchase agreement early, you may have paid extra charges without your knowledge.
Secondly, if you took out Payment Protection Insurance (PPI) on your hire purchase agreement, you may also be able to reclaim hire purchase charges as many PPIs have been missold in recent years.
When you pay off your hire purchase agreement early, an early repayment charge is added which is a penalty charge added by the finance company. However, this penalty should be reasonable and reflect the cost of the item purchased. This penalty charge is not a way for the finance company to make a huge profit and if the charge appears to be very high, this is definitely a reason to contact reclaim hire purchase charges lawyers.
Reclaim Hire Purchase Charges and PPI
Today, it is also possible to take out payment protection insurance with your hire purchase agreement and this is way to protect yourself should you not be able to make repayments due to ill-health or if for some reason you lose your job or if you suffer an accident.
But payment protection insurance is not suitable for everyone and if it has been charged incorrectly to you, you may be able to possibly reclaim hire purchase charges.
There are an estimated 20 million such policies in the UK, so they are a pretty standard product. That said, banks and financial institutions have been known to missell PPI policies and it is estimated that up to 2 million people have been missold these types of policies.
This can happen for a number of reasons but researchers point out that it most commonly occurs due to the pressure placed on bank and financial institution employees to reach quotas for sales of payment protection policies.
You may have been missold payment protection insurance if you have been sold a policy that is not relevant to your circumstances, does not provide you with sufficient coverage or if the policy was not properly explained to you.
In some cases, payment protection insurance policies have been added to customers’ accounts without their knowledge. This is totally illegal and in this case, it is certainly possible to reclaim hire purchase charges.
Reclaim Hire Purchase Charges and PPI Limitations
The circumstances in which you might not qualify for a payment protection insurance policy are as follows:
- If you are self-employed
- If you are retired
- If you gave up work due to a pre-existing medical condition
- If you gave up work due to stress
- If you gave up work due to back problems
The current legislation holds that if a person was missold payment protection insurance after 2005 either in relation to loan repayment or a hire purchase agreement, they have the right to contact solicitors and in the case of a hire purchase agreement, the person may be entitled to reclaim hire purchase charges.
If you have a hire purchase agreement that was purchased after 2005, check to see if there is payment protection insurance added to it. If there is, the instances in which you may have been missold this policy and may be able to reclaim hire purchase charges, include the following:
- If you are unemployed, self-employed or retired.
- If you have a serious medical problem that affects your ability to work but you were not asked about your medical history.
- If you were sold a single PPI policy but the loan was then cancelled or repaid early.
- If the cost of the PPI was not fully explained to you.
- If the quote for the cost of the agreement included the cost of the PPI but you were not informed of this.
- If you were told that the PPI payment was obligatory.
- If you were covered by an existing policy but this was not properly explained.
With so many financial products available on the market and so many different companies involved particularly in the case of hire purchase agreements, unfortunately the cases of clients being overcharged are all too frequent.
In all situations, it is essential to check the fine print and not be afraid to ask questions. If you are in any doubt, do not hesitate to contact reclaim hire purchase charges lawyers and verify your rights. These days, money is tight enough for everybody so it is more important than ever not to pay more than is necessary. You have the right to reclaim hire purchase charges, if those charges have been applied unfairly, so seek advice today!