Section 75a

JHAnewby

Hi I am looking at buying a car through a website. I would pay £1000 on the credit card as a deposit and the rest as a bank transfer. The car is £31.5k.

The car gets delivered on purchase. So if the company goes bust or it doesn’t arrive would the purchase be covered?  It’s over £30k but not sure whether section 75a would apply if it’s not bought on loan finance with the dealer.  Any ideas?
 Thanks 

452

You're spending over 30k on a car you've not seen?

molerat

s75 does not apply to goods costing in excess of £30K.  If under that limit then you would be covered as you paid part on a credit card, dealer finance is irrelevant, the item would be at least part paid with credit.  In a worst case scenario you would likely only be able to charge back the £1K deposit.  Are you sure this website is 100% kosher ?

JHAnewby

Thanks it’s a new car so exactly the same as we’re being offered from a dealership and manufacturer when you see a similar one but you order one from a dealer you don’t see it until it arrives.

It is section 75a if it’s over £30k rather than section 75 that applies here.

I haven’t ordered that’s why I’m asking!!

born_again

As over £30K no S75 cover.
If it did not turn up then you would have no finance to pay. As well as a chargeback right on the £1K

DoaM

S75A seems to apply >£30k and <£60,260

http://www.legislation.gov.uk/ukpga/1974/39/section/75A

born_again

DoaM said:

S75A seems to apply >£30k and <£60,260

http://www.legislation.gov.uk/ukpga/1974/39/section/75A

Could be a interesting conversation. 

Ectophile

I'm not convinced that paying a deposit on credit card is a "linked credit agreement".

shaun_from_Africa

Ectophile said:

I'm not convinced that paying a deposit on credit card is a "linked credit agreement".

You are correct. It's not.
S75a of the Consumer Credit act came about because of an EU directive (2008/48/EU)
https://eur-lex.europa.eu/legal-content/en/ALL/?uri=CELEX%3A32008L0048
and the definition of a linked credit agreement in that directive is:

‘linked credit agreement’ means a credit agreement where the credit in question serves exclusively to finance an agreement for the supply of specific goods or the provision of a specific service, and those two agreements form, from an objective point of view, a commercial unit; a commercial unit shall be deemed to exist where the supplier or service provider himself finances the credit for the consumer or, if it is financed by a third party, where the creditor uses the services of the supplier or service provider in connection with the conclusion or preparation of the credit agreement, or where the specific goods or the provision of a specific service are explicitly specified in the credit agreement.

So, S75 applies for goods or services that cost between £100 and £30k provided any part of the purchase price was made on credit such as a finance agreement or credit card.
S75a applies if the goods or services cost between £30k and £60,260 provided that the credit was specifically obtained only for the purchase and is linked directly to it.

JHAnewby

Hi

yes precisely. So does that mean if you pay some deposit on a credit card and the rest in cash for a good over £30k it wouldn’t be covered at all but if it was bought on loan finance it would be covered?

Thanks

KeithP

JHAnewby said:

Hi

yes precisely. So does that mean if you pay some deposit on a credit card and the rest in cash for a good over £30k it wouldn’t be covered at all but if it was bought on loan finance it would be covered?

Thanks

Yes, as long as the loan was specifically for that purchase.