It should be once again pointed out that only certain types of credit agreements, made under certain circumstances have a statutory cooling off period. If you have signed an agreement in on trade premises, in the presence of the lender (or a party to the agreement), the contract is legally binding from the moment it is signed.

Ending a credit agreement

The Consumer Credit Act (CCA) gives the consumer the right to settle a fixed-sum credit (loan) agreement early, by giving notice to the lender and paying the outstanding sum in full. New regulations prescribe exactly how the outstanding sum should be calculated, so there should be no concerns of being ripped off by the lender. Furthermore, consumers have the right to claim a rebate of the charges for credit (less taxes, duties, fees or charges payable). The amount of the rebate is defined in the Act as:

…the difference between the total amount of the repayments of credit that would fall due for payment after the settlement date if early settlement did not take place

The settlement date for the purposes of calculating the rebate will generally be 28 days after the consumer notifies the lender of their intention to settle the agreement early, although this can be deferred.

Similar to s 77-79 of the Consumer Credit Act, s 97 allows the consumer to request a statement containing information pertaining to early repayment. Failure to do so within 12 working days renders to debt unenforceable until the statement is provided.

Terminating an agreement

In the case of HP or conditional sale, the agreement can be terminated at any time before payment of the last instalment, provided at least one half of the total price has been paid and reasonable care of the goods has been taken. For hire agreements the agreement can only be terminated after 18 months (unless an earlier date is mentioned on the contract).