Abacus Daily Debt News

OFT clarifies Consumer Credit Act

Sections of the Consumer Credit Act 1974 are to be clarified by the Office of Fair Trading (OFT) in order to help those in debt understand how they apply to them.

According to the organisation, some people are under the impression that parts of the Act can be utilised to eradicate debt, while a number of creditors are not offering information to their clients, which they are legally obliged to do.

Director of consumer credit with the OFT Ray Watson noted that "a great deal of confusion" has arisen.

"This guidance is to clarify the legal position and the OFT view on standards expected of the industry," he continued, adding that it also intends to make people aware of the risks of trying to use the Act to avoid "legitimately owed" arrears.

Meanwhile, UK adults were recently advised by Andrew Hagger of Moneynet.co.uk to avoid accidentally going into their overdrafts without authorisation in January and, if it looks likely, to contact their creditor to accommodate this.

By Sarah Adie