Hire Purchase Agreements

Hire purchase (HP) arrears are a priority debt that you should consider dealing with as soon as possible as delays can lead to repossessions and court action.

Hire purchase (HP) or ‘conditional sale’ agreements are when you buy cars or furniture etc. An HP agreement is a debt, and you don’t actually own your goods until the debt is paid off. Until then, they belong to the person you bought them from (the creditor).

Under hire purchase agreements you can't sell the goods until the money's paid off and
creditors can ask you to return the goods if you don't make regular payments. If you fall behind on your payments, a creditor may ask you to return your goods. However, if you’ve paid more than a third of the total debt, they have to go through the County Courts first.

If you’ve paid less than a third of your debt, a creditor only needs a court order when they want to remove goods from your property. But this isn’t necessary if they’re in a public place. For example, if you have a HP agreement on your car, a creditor can remove it from the street without a court order.

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