Good News For Those That Like To Own Their Cars

Monday, 8. February 2010

For those that like to own their vehicles and have a penchant for hire purchase there is some good news, you can now receive treatment for this condition, known as ‘bonkers’, on the NHS. OK serious stuff. I reported last year that the EU had issued a directive that meant that, amongst other things, the ability to voluntarily terminate your agreement once 50% of the full cost has been repaid would no longer apply to conditional sale agreements but would still apply to hire purchase agreements as they fell outside the directive. As this action is costing the industry well in excess of £100 million each year there was a fear that the finance industry would dump hire purchase in favour of conditional sale. For those uncertain of what I’m talking about, in the eyes of the law a conditional sale agreement is virtually the same as a hire purchase agreement except the funder could attach a few extra conditions to a conditional sale that he couldn’t to hire purchase but, as a consumer, your rights are identical under the Consumer Credit Act. Section 99 of the act allows you to simply hand the vehicle back to the finance company once 50% of the total cost has been repaid. Whilst the lenders were probably tooling up for the change from HP to conditional sale agreements the UK Government has stepped in and said that VT provisions are unique to the UK and will therefore remain on all HP/conditional sale agreements and section 99 will remain. When asked to comment the Department for Business Innovation and Skills (BIS) have now confirmed that it sees no need to remove VT’s, clearly good news for those suffering from ‘bonkers’. By Graham Hill