14-day right of withdrawal
For most regulated credit agreements you can withdraw within 14 days of signing, or of receiving your copy of the agreement if later, without giving a reason. You must repay the money borrowed plus interest for the days you had it.
Early settlement
You can repay all or part of a regulated loan early. On a fixed-rate loan, the lender may charge compensation of up to 1% of the amount repaid early, or 0.5% if less than 12 months remain, where you repay more than £8,000 in any 12-month period.
Voluntary termination on HP and PCP
On hire purchase and PCP agreements you can end the agreement and return the vehicle once you have paid half of the total amount payable, provided you have taken reasonable care of it.
If things go wrong
Complain to the firm first. It has up to eight weeks to send a final response. If you are unhappy with the response, you can take your complaint to the Financial Ombudsman Service, free of charge.
Common questions
Does the cooling-off period apply to business loans?
Generally no, unless the borrower is a sole trader or small partnership and the agreement is regulated.
Can I get a settlement figure at any time?
Yes. You can ask for a settlement statement, and the lender must provide it within seven working days.
This guide is general information, not personal financial advice. If you are worried about debt, free help is available from MoneyHelper, StepChange and Citizens Advice.