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Question
I've taken out a hire-purchase agreement on a car and although I've made some of the payments I've now fallen behind with them.
The company is now threatening to repossess the vehicle, would it be a criminal offence if they tried to but couldn't? And what can they do to get the car back?
Answer
If you get behind with your payments it is possible, under the Consumer Credit Act 1974, for the credit company to take back the goods in certain circumstances. Until you've paid a third of the instalments on the goods it is possible for the credit company to take the goods back without a court order. Once you've paid a third of the instalments the company would need to go to court to get an order to recover the goods.
It is also possible for you to hand the goods back, but under the Consumer Credit Act you would be expected to pay half the credit originally borrowed (this would include any arrears and then an additional sum of money to bring the total to 50% of the credit borrowed). You can find out more about this on the Adviceguide website.
If the company send their agents to recover the goods and you were to deliberately hide them so they couldn't get them back you could potentially be charged with theft. If the car is in a public place, e.g. in a supermarket car park or on the road outside your house, the agents of the credit company can take the car and they're likely to charge you for this service. This could cost you over £100 every time they try to get the car back so the debt would increase.
Finally, it's worth remembering that if the debt is more than £750 the credit company could also make you bankrupt.
To get further advice and information you might find it useful to talk to an adviser at National Debtline on 0808 808 4000. Calls are free and confidential and they'll be able to talk through your options in detail.
Updated: 30/06/2008
Question answered by CAB
