By Marvin St. Louis, Ministry of Commerce: The Consumer Affairs Department is encouraging consumers to read and understand hire purchase agreements before signing.
While buying on credit spreads the cost of an item over a period of time—a comfort for customers, the Consumer Affairs Department is concerned that the terms and conditions of hire purchase agreements are not fully read and understood. This has led to misinterpretation of the law.
Information Officer at the Consumer Affairs Department, Mrs. Merlicia Williams-Davy said very few customers will read the conditions of the contract are signing on to.
“Take a stove for example. A customer goes into the store, identifies the product; to complete the transaction, the clerk prints out the agreement and indicates where the customer should sign. Most will just sign without reading,” she said.
Hire purchase transactions are governed by the Consumer Credit Act Cap 13.15. All agreements must be in keeping with this legislation. Subject to section 26 within this legislation, the owner may exercise his or her right to recover unpaid goods.
Mrs. Davy explains: “Under a hire purchase agreement, the good does not belong to the consumer until the final payment is made, and so if there has been a breach of contract or a consumer has failed to make the monthly payments, the owner has the right to repossess his or her goods. This can be done only after the owner has given the consumer 21 days’ notice of his or her intention to repossess, and that must be in writing. The owner must also give the consumer a period of not less than 10 days after the notice has been served to come in and make a payment.
“Now if the consumer has already paid more than 70 percent of the hire purchase price, the owner cannot repossess without obtaining a court order. However, if less than 70 per cent of the hire purchase price has been paid, once the owner has given the consumer sufficient notice in writing, the goods can be recovered or repossessed.”
The Consumer Affairs Department is providing additional education on hire purchase and other consumer related transactions at its office on the corner of Micoud and Coral streets in Castries. Consumers are encouraged to know their rights and obligations