Unenforceable or Unfair Credit Agreements - 'UCA' Claims
These claims are credit agreements which are invalidated due to their failure to comply with the Consumer Credit Act 1974.
Credit agreements might be unenforceable if:
- The agreement doesn't state the amount of credit.
- Credit/store cards do not state the credit limit or level of monthly repayment.
- There is no rate of interest or it is miscalculated
- The agreement does not state the number of instalments, the amount of repayments, when they are due, their frequency and timing, and any powers available to the creditors to vary what is payable.
- The agreement is not signed.
- In the case of cancellable agreements, failure by the creditor or hirer to include, in an agreement or copy, notice of the right to cancel (in the prescribed form), or failure to supply a separate notice of a right to cancel where it is required.
The above is not an exhaustive list and there are other situations where agreements can be challenged. A detailed analysis is made on each individual case. It is important to understand this is not a loophole as portrayed by many lenders, but where credit providers did not get the prescribed terms correct when issuing the agreements.
Some lenders have been fined for a breach the regulations, see our Case Studies Section.
CCA can assist with credit claims on loans, or purchased goods to the value of £25,000 or less but can also typically assist with the following:
a) Agreements applicable to cash loans or loans to purchase specified goods (typically vehicles, white goods, brown goods and other associated consumer goods). These agreements are categorised as Fixed-sum loan agreements, Hire purchase agreements or Conditional sale agreements.
b) Agreements applicable to overdraft, credit card and store card facilities. These are classed as running account agreements and are categorised as Credit Card agreements or Credit agreements.
c) Agreements as detailed in point a) that were taken out between 01/01/1998 and 07/04/2007 that have been paid off.
Some solicitors in the UK pursuing claims for repayment of PPI insurance are not challenging the loan agreement itself. This can result in compensation and a new loan, which deprives the client of the right to have the loan cancelled altogether. Would you prefer £3000 compensation or have your outstanding £15,000 loan written off?
Almost all agreements where PPI has been mis-sold automatically invalidate the agreements. Such agreements have incorrectly stated APR, incorrect or hidden charges and wrongly stated total costs.