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6 What are my rights in a Hire Purchase or Conditional Sale Agreement?

A hire purchase or conditional sale agreement means that goods will be hired to you for an agreed period during which you pay instalments. You do not legally own the goods until you've paid the last instalment. During the hire purchase agreement the goods belong to the hirer so you must not sell the goods without getting their permission.

You do have a right to end the agreement early.  You can do this by writing to the finance company stating clearly that you want to terminate the agreement.  Send your letter by recorded delivery.  If you end the agreement early, you must return the goods and you will then normally be liable to pay half the amount due under the agreement, less the payments you have already made.

If you do not keep up the payments, the hirer is only allowed to repossess the goods if:

  • you have given your permission for this to happen;
  • the hirer has obtained a court order; or
  • you have paid less than a third of the total purchase price and the goods are stored on public land.

If you need help dealing with a hire purchase agreement or any other aspect of debt, we recommend that you speak to one of our debt advisers on 0845 345 4 345 for specialist advice. Telephone specialist advice is only available if you qualify for legal aid.

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