Drafting and varying consumer credit agreements
Produced in partnership with Reanne MacKenzie, Barrister of Henderson Chambers
Drafting and varying consumer credit agreements

The following Financial Services guidance note Produced in partnership with Reanne MacKenzie, Barrister of Henderson Chambers provides comprehensive and up to date legal information covering:

  • Drafting and varying consumer credit agreements
  • Light touch
  • Agreements before and after 1 February 2011
  • Agreements secured on land
  • Proper execution
  • Unexecuted and executed agreements
  • Cancellable agreements
  • Multiple agreements
  • Variations

A consumer credit agreement is an agreement between an individual (the debtor) and any other person (the creditor) by which the creditor provides the debtor with credit of any amount. The financial limit of £25,000 has been removed since 6 April 2008.

In the context of consumer credit (or consumer hire), a regulated agreement is a consumer credit agreement or consumer hire agreement that is not an exempt agreement as per section 8 of the Consumer Credit Act 1974 (CCA 1974), or, in the case of consumer hire, CCA 1974, s 15.

Light touch

Some categories of agreement are for the most part exempt from the regulations made under the CCA 1974, Part V in relation to:

  1. cancellation rights, and

  2. form and content requirements

The types of agreement are:

  1. non-commercial agreements

  2. current account overdrafts

  3. agreements to finance payments on death

  4. small debtor-creditor-supplier agreements for restricted-use credit

It is also possible to apply to the Financial Conduct Authority (FCA) for an exemption where it is impractical for the lender to comply with the regulations. Such exemptions have been granted to some social housing associations for shared equity schemes.

As of April 2014, regulation for the consumer credit industry passed from the Office of Fair Trading (OFT) to the FCA.

Agreements before and after 1 February 2011

The Consumer Credit (Agreements) Regulations 2010, SI 2010/1014