Home     Articles    Sale of goods and services    Required statements for regulated agreements

Required statements for regulated agreements

 
   
Introduction  
The Consumer Credit Act and its amendments affect all those who use credit to buy goods and or services, for example, on hire-purchase agreements or using a store credit card. The Act governs the licensing of, and other controls, on traders who supply credit, or goods and services on credit. It is therefore a valuable tool to have knowledge of how it works at your fingertips.  
   
This article explains a recent change to Consumer Credit law – the CCA 2006. Specifically, it explains the requirement for a statement of money owed and paid.  
   
Required statement  
Section 6 of the Consumer Credit Act 2006 inserts a new section (s77A) whereby a statement must be provided if the agreement is a fixed sum credit agreement under section 77A. The statement should explain the money borrowed, money paid, interest in all cases and the outstanding amount.  
   
Particulars  
The creditor under a regulated agreement for fixed sum credit:  
  • Shall (with in the period of one year beginning with the day after the day on which the agreement is made), give the debtor a statement under this section; and
  • After the giving of that statement, shall give the debtor further statements under this section at intervals of not more than one year.
 
   
Failure to provide the statement  
If the creditor fails to give the debtor an annual statement, then he is not entitled to enforce the agreement during the period of his noncompliance and the debtor is not liable to pay any interest during this period.  
   
The debtor is also not liable to pay any default sum that would have become payable during the period of non-compliance or would have become payable after the end of that period in connection with a breach of the agreement occurring during that period. However a creditor will not be required to give the debtor an annual statement if there is no further sums payable under the agreement.  
   
Further provisions relating to running account credit agreements  
Section 7 of CCA 2006 inserts a new section (78(4A) of the 1974 Act) which requires creditors to issue further statements to debtors setting out specified information in respect of running account credit agreements.  
   
The statements must be provided at intervals of not more than 12 months. Creditors may further be required to include specified information about the consequence of failing to make repayments, or only making minimum repayments.  
   
The Dispensing Notice  
If there are two or more debtors, a debtor may provide a ‘dispensing notice’ to the creditor to the effect that the creditor is not obliged to provide a second statement to that debtor. However, dispensing notices will not be effective if that would mean that neither debtor will receive a statement.  
 
If by chance you find any error in this information page, do please tell us. We should also welcome your suggestions for new subjects for information pages. These notes:
    Do not provide a complete or authoritative statement of the law;
    Do not constitute legal advice by Net Lawman;
    Do not create a contractual relationship;
    Do not form part of any other advice, whether paid or free.

Related Documents
Unsecured loan agreement
Price: £24 Find out more
Horse loan agreement
Price: £14 Find out more
Secured loan agreement: by guarantor
Price: £29 Find out more
Secured loan agreement: on financial instruments
Price: £29 Find out more
 
Related Articles
bbb
The law on Package Holidays: For tour operators and other agents
bbb
Buying or selling your business: Part 1
bbb
Weights and measures
bbb
Labelling requirements for beef and veal in the UK
bbb
Labelling and marketing spirit drinks in the UK
bbb
Business terms and conditions
bbb
Make a small claim online with - Money Claim Online?
bbb
Publishing agreements: How to get the best deal
bbb
Small claims advice
bbb
How to write effective complaint letters
bbb
Unfair Terms in Consumer Contract Regulations 1999
bbb
Types of personal loans
bbb
Authors guide to publishing
 
  Need Drafting Services?
  Visit our personal drafting service pages for bespoke drafting.
  Learn more...
 
 
  Legal Document Services
  Buy legal forms and documents prepared for your precise requirements.
  Learn more...
 
 
  Solicitors! Sell your documents
  If you have document worth-selling, let us sell it. Earn up to 30% royalty.
  Learn more...
 
 
 
 
© 2000 - 2012 Net Lawman Ltd. All rights reserved.