Dealing with your priority debts

​Hire purchase or conditional sale

You can buy goods on all sorts of different credit agreements. With most credit, you own the goods straight away and only owe the money to the creditor. The creditor cannot ask you to return goods you bought with most types of credit. With hire-purchase or conditional-sale agreements, you do not own the ​goods until you have paid the last instalment. The most common type of goods on hire-purchase agreements are cars.

Can my lender take back the goods?

Extra advice:

what kind of agreement do you have?

If you have a hire-purchase agreement or conditional-sale type of credit agreement, it should state this clearly. This information only covers hire-purchase or conditional-sale agreements which come under the Consumer Credit Act. If you are not sure what type of agreement you have, check your agreement or contact us for advice.

If you fall behind with your payments, the lender may be able to ask for the goods to be returned and then sell them to reduce the debt. You cannot sell the goods yourself without the lender's permission.

​Have you paid less than a third of the debt?

If you fall behind with payments, the lender may be able to repossess the goods. If you have paid less than a third of the debt, the lender may not need to get a court order before taking the goods back.

You can also return the goods.

Returning hire-purchase goods voluntarily

Have you paid off more than a third of the debt?

If you have paid off more than one third of the total owing, the creditor must go to court to ask for the goods to be returned. They cannot just come round and remove them.