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Refund after cancelling contract

I recently entered into a contract for some work I needed doing on my property. I paid the company £2500 as a deposit using my Barclaycard. The contract was subject to an inspection by the builder and had a 14 days cooling off period. When the builder came to inspect the required work, (it took nearly 2 weeks and several reminders from me) he told me that it wasn't feasible to carry out the work. So I immediately cancelled the contract within 1 day of the 14 days period. I also requested the refund of my deposit.

However, the director of the company with whom I was dealing gave me some excuse that he doesn't know how to do a refund and it could take him 1-2 weeks to do it. I have since received a letter from him confirming the cancellation and that he'll do the refund within 28 days. I rand B/C who put the transaction in dispute so I don't have to pay the trans and they are investigating. But is he allowed to take 28 days to make the refund thereby gaining free credit. I would have expected B/C to charge him interest.
Before doing something... do nothing
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Comments

  • Chucky1234
    Chucky1234 Posts: 250 Forumite
    Seventh Anniversary 100 Posts Name Dropper Combo Breaker
    I believe they are allowed 14 days.
  • paddyrg
    paddyrg Posts: 13,543 Forumite
    It probably is a lot more innocent than you fear - it takes time for companies to process refunds as each one requires manual intervention. Business won't earn interest on the money, and frankly the interest on £2500 for an extra fortnight would be negligible if they did.
  • lindabea
    lindabea Posts: 1,486 Forumite
    Part of the Furniture 1,000 Posts Name Dropper
    paddyrg wrote: »
    It probably is a lot more innocent than you fear - it takes time for companies to process refunds as each one requires manual intervention. Business won't earn interest on the money, and frankly the interest on £2500 for an extra fortnight would be negligible if they did.

    I find that hard to understand why it takes companies time to process refunds. If I take an item back to a store, I get an immediate refund, although it may take a few days to appear in my account. As for the negligible interest, this may indeed be the case, but the company is still benefiting from a free injection of cash to help with their cash flow at the cost of the card provider or me for that matter, if I am expected to settle the transaction so that I do not incur any interest on my credit card. I still think it is an unacceptable practice, and the company should be made to pay interest for each day that the transaction is not refunded.
    Before doing something... do nothing
  • wealdroam
    wealdroam Posts: 19,181 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Combo Breaker
    lindabea wrote: »
    I still think it is an unacceptable practice, and the company should be made to pay interest for each day that the transaction is not refunded.
    Is that in the agreement you have with the builder?

    If so, then you need to ensure that the builder pays interest for each day that the transaction is not refunded.
  • lindabea wrote: »
    I still think it is an unacceptable practice, and the company should be made to pay interest for each day that the transaction is not refunded.
    Good for you. I would be chasing that money your greedy builder is squandering every day!

    So far, I think he owes you about 27p a day so far! Based on a rate of 4%. Obviously you need to pay tax on this as well!
  • lindabea
    lindabea Posts: 1,486 Forumite
    Part of the Furniture 1,000 Posts Name Dropper
    Good for you. I would be chasing that money your greedy builder is squandering every day!

    So far, I think he owes you about 27p a day so far! Based on a rate of 4%. Obviously you need to pay tax on this as well!

    For your information, the total interest on my credit card statement is already £57.17. So you think it's OK for me to absorb that charge while he is making use of free credit. It's not the amount of money involved that matters, but the principal that he can take a ridiculous 28 days to make a refund. Perhaps you can let me know how you would feel if a similar thing happens to you. I'm sure you won't be so glib about it
    Before doing something... do nothing
  • wealdroam
    wealdroam Posts: 19,181 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Combo Breaker
    lindabea wrote: »
    For your information, the total interest on my credit card statement is already £57.17. So you think it's OK for me to absorb that charge while he is making use of free credit. It's not the amount of money involved that matters, but the principal that he can take a ridiculous 28 days to make a refund. Perhaps you can let me know how you would feel if a similar thing happens to you. I'm sure you won't be so glib about it
    Ah... so you want to charge him interest at some exorbitant rate, like your credit card supplier does you?
    Good luck with that.

    Do you even have a contract with this builder?
  • lindabea
    lindabea Posts: 1,486 Forumite
    Part of the Furniture 1,000 Posts Name Dropper
    wealdroam wrote: »
    Ah... so you want to charge him interest at some exorbitant rate, like your credit card supplier does you?
    Good luck with that.

    Do you even have a contract with this builder?

    Well.... that exorbitant rate as you call it, is what my credit card company is charging me for the privilege of him getting free credit. And if you take the interest to read my first post, you will see that I cancelled the contract. I thought this is a forum for upholding consumer rights - or am I missing something here? Just what is it that you think it's OK for him to take 28 days to refund me the money and laugh at my face when I asked him to refund it and I could end up paying the interest myself. I came to this forum to get some advise - not to be insulted
    Before doing something... do nothing
  • paddyrg
    paddyrg Posts: 13,543 Forumite
    lindabea wrote: »
    . If I take an item back to a store, I get an immediate refund, although it may take a few days to appear in my account.

    I do appreciate what you're saying, although comparing a retail establishment with a builder isn't really a useful comparison. Retail returns are usually under say £100, and they are set up for cash transactions. Indeed, retailers are under no obligation to offe on the spot refunds for changes of mind (and can offer replacements or repairs as well as refunds if faulty), and it's customer goodwill that makes them take the hit on doing so. The back-end reconciliation is still a chunk of work.

    Is it fair? Probably not. Is it right? Doesn't seem so. Is it the way it is? Seems to be. My sympathies, but I think you'll just need to weather this one.
  • wealdroam
    wealdroam Posts: 19,181 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Combo Breaker
    lindabea wrote: »
    Well.... that exorbitant rate as you call it, is what my credit card company is charging me for the privilege of him getting free credit. And if you take the interest to read my first post, you will see that I cancelled the contract. I thought this is a forum for upholding consumer rights - or am I missing something here? Just what is it that you think it's OK for him to take 28 days to refund me the money and laugh at my face when I asked him to refund it and I could end up paying the interest myself. I came to this forum to get some advise - not to be insulted

    Have you read MSE's How to Complain article yet?

    The company have promised a refund.

    As they have not provided the refund in an appropriate time, your next step is to send a letter before action. Google it for samples.

    If they do not reply to your lba in the defined time then you need to move to the next step - Small Claims Court action.

    Read all about the small claims court in MSE's guide.

    Some months will have passed before this gets to court, so you had better start thinking about alternative ways to reduce your credit card bill.

    One way of reducing that credit card bill is to speak to your card issuer about a claim under Section 75 of The Consumer Credit Act.
    Read MSE's Section 75 article for details.
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