Consumer Credit Act Unregulated Agreements

The Consumer Credit Act (CCA) has been around since 1974, and it’s a law designed to protect consumers who use credit to purchase goods or services. It applies to a wide range of credit agreements, including unregulated agreements.

Unregulated agreements are financial agreements that aren’t covered by the CCA. This means that they are exempt from some of the protections that the Act provides to consumers. These agreements are usually entered into by high net worth individuals or companies, and they often involve large sums of money.

The CCA was amended in 2006 to provide some protection for consumers who enter into unregulated agreements. Under the amended Act, if a consumer uses credit to purchase goods or services that are worth over £60,000, then the agreement is considered unregulated. However, if the goods or services are worth less than £60,000, then the agreement is regulated by the CCA.

Unregulated agreements can be risky for consumers because they don’t have the same level of protection as regulated agreements. For example, the lender may not have to provide a cooling-off period, which means that the consumer can change their mind and cancel the agreement within a set period of time. The lender may also be able to charge higher interest rates or fees than they would be able to under a regulated agreement.

If you’re considering entering into an unregulated agreement, it’s important to be aware of the risks involved. You should carefully read the terms and conditions of the agreement and seek legal advice if you’re unsure about anything. You should also compare the agreement with other options available to you, such as a regulated credit agreement, to ensure that you’re getting the best deal.

In conclusion, unregulated agreements can be a risky business for consumers. If you’re considering entering into one, make sure you’re fully aware of the risks involved and carefully consider all your options. Seek legal advice if necessary, and remember that regulated agreements offer stronger protections for consumers.