A Hire Purchase agreement refers to the agreement entered into between the hirer (customer) and the owner (HomeSmile).
Goods refer to those goods that are set out in the schedule to the Hire Purchase agreement.
Hire Purchase price refers to the total sum payable over the life time of the Hire Purchase agreement in order to complete the purchase of the goods.
Hirer refers to the customer who enters into the agreement with the owner.
Owner refers to Estone Personal Credit Limited trading as HomeSmile the company.
Hire Purchase is an agreement whereby a customer hires goods for a period of time by paying instalments to HomeSmile, and can own the goods at the end of the agreement if all of the instalments are paid in full.
Applications and Eligibility
All applications are subject to HomeSmiles lending criteria. All applicants must:
- Be over the age of 18 years.
- Have been a resident in the UK in the last year
- Have photo identification for proof of ID
- Have documentation for proof of residency.
- Live within the areas serviced by the company.All agreements for Hire Purchase will be completed in the home of the applicant.
Credit Reference Agencies
By completing HomeSmiles applicant detail form, the applicant will be asked to give full permission to HomeSmile to consult with a credit reference agency to access the applicants credit history and assist the company with the decision making process.
Authorised and Regulated by the Financial Conduct Authority
HomeSmile will conduct creditworthiness and affordability checks using information from the applicant’s credit report and affordability application. HomeSmile will access these sources of information to help make an objective responsible lending decision based upon the applicant’s circumstances, and that is central to applicant’s best interests.
HomeSmile reserves the right to refuse credit at their discretion if they feel that the application to enter into a Hire Purchase agreement is not in the best interest of the applicant.
However, where an application is approved the applicant is under no obligation at any point to enter into the agreement.
HomeSmile will only accept one customer per household per calendar year.
All new customers and existing customers will only be issued with goods that have repayment terms that are up to 30% of the applicant’s disposable income.
If the customer has cash loans from our sister brand Estone Personal Credit Limited, the credit agreement and hire purchase agreements will be viewed as one credit limit. As such, combined the weekly repayments must not exceed 30% of the customers disposable income.
HomeSmile offers a range of essential home goods on credit to their customers.
The company charges different interest rates depending upon the chosen repayment period, which can be the following:
- 25 Weeks: Flat Rate 40.00%, PA 83.43%, APR 315.2%
- 52 Weeks: Flat Rate 61.20%, PA 61.37%, APR 177.7%
- 76 Weeks: Flat Rate 74.80%, PA 51.32%, APR 131.1%
- 102 Weeks: Flat Rate 83.60%, PA 42.74%, APR 99.2%
- 147 Weeks: Flat Rate 97.00%, PA 34.90, APR 72.4%
All interest rates at HomeSmile are flat and fixed.
Representative HomeSmile Hire Purchase Loan Example (Please note that this example is based on a loan over 52 weeks because this is our most popular loan term):
Hotpoint Washing Machine Model Number: WMBF742P
Cash Cost: £341.34
Small Deposit of: £11.34
Amount of Credit: £330.00
Loan repayable over: 52 Weeks
52 Weekly payments at: £10.23
Rate of interest PA: 61.37%
Annual Percentage Rate: 177.7%
Total Amount Payable: £531.96
HomeSmile offers their customers the following avenues of repayment on the goods:
- Home Cash Collection
- Standing Order
- Debit Card Payment
HomeSmile will visit their customers on a weekly or monthly basis (this is the customer’s choice) to update payment cards in accordance with the companies responsible lending policy.
Before an agreement is entered into, the customer will be given an adequate explanation of the Hire Purchase agreement covering the key features of the agreement. In addition to this, the customer can be given a draft agreement to examine. The customer is under no obligation to enter into any of HomeSmiles agreements, and must be 100% comfortable before making a decision to borrow.
A customer that does decide to enter into an agreement will receive a copy of their signed agreement.
Goods are most often sold under Hire Purchase agreements and will only belong to the customer when they are paid for in full. Goods must not be sold, disposed of, or used as a security against another credit agreement until they are owned by the customer. The terms of the Hire Purchase agreement will be fully explained to the customer before the agreement is entered into.
Cancellation of Contracts
Right to Withdraw from the Hire Purchase
The customer has the right to withdraw without reason from the agreement by contacting in writing or orally HomeSmile.
The customer will be able to withdraw from the agreement for up to 14 days beginning with the day after the day they receive the executed copy of the agreement. The customer must repay HomeSmile without delay and no later than 30 calendar days after giving notice of the withdrawal.
The customer must pay the total amount of credit plus any daily interest that has accrued to the date that HomeSmile receives payment.
Customers have the right to end Hire Purchase agreements at any time by notifying the company in writing. The customer will be entitled to return the goods and half of the total amount payable under the agreement.
The customer must come to an agreement with HomeSmile to arrange a repayment plan to pay the difference between the amount they have paid and the amount they are due to pay once the goods have been returned.
If a customer has paid this amount plus any overdue instalments and have taken reasonable care of the goods they will not have to make any further payments to HomeSmile.
If the goods in question are damaged in anyway the customer could be liable to pay for any damage caused.
Missed Payments under Hire Purchase agreement
HomeSmile prefers customers experiencing financial difficultly and payment problems to notify the company of their circumstances. Forbearance will always be shown to customers, and the company will assist the customer in reducing weekly payments where necessary at no extra cost until their financial circumstances change and they can make full payments again. If the customer suffers a long term financial alteration we will investigate the issue fully, and if necessary reschedule the loan to a weekly payment they can comfortably afford. This usually means that the Hire Purchase agreement exceeds the original loan term as the weekly payment has been reduced.
Where customers make no attempt to make regular payments on their goods, and avoid communication with the company, repossession can be a possibility. If the customer has not yet paid one-third or more of the total Hire Purchase price, HomeSmile can repossess the goods at any time without taking legal action.
However, if the customer has paid one-third or more of the total Hire Purchase price Estone Personal Credit would have to take legal proceedings to repossess the items in question. Estone Personal Credit, in this circumstance, will not attempt repossession of any goods without firstly obtaining a court order.
If the one-third rule is breached by Estone Personal Credit the customer must be aware that they are entitled to end the agreement and receive a refund of all payments made during the agreement.
HomeSmile does not charge any documentation fees, missed or late payment fees, repossession charges, or rescheduling charges.
The only fees payable by the customer are default charges, pre litigation charges, and court costs if a customer makes no attempt to pay for goods under the Hire Purchase agreement. These are explained to the customer during the pre-contractual adequate explanation of the Hire Purchase agreement.
Damaged or Faulty Goods
If there is a problem with goods sold under a Hire Purchase agreement, HomeSmile will uphold the customers rights under the Supply of Goods (Implied Terms) Act 1973.
We ensure goods are the following:
- Of merchantable quality
- Fit for normal purpose, and reasonably durable
- As described by the company
All products do come equipped with a 1 years manufactures warranty unless otherwise stated (and if this is the case the warranty is only ever long than 1 year). If any problems occur outside of this warranty whilst still under the Hire Purchase agreement, it is the responsibility of HomeSmile to deal with problem, and we will ensure that the product is fixed or replaced in a reasonable time frame if we conclude that product has not been mistreated or abused. If a problem occurs during the manufacturer’s warranty it solely the responsibility of the manufacturer to deal with the problem.
Customers can find information relating to warranty information for their goods on their ‘Customer Fact Sheet’ which they should have received with these terms and conditions.
If a customer returns defective goods, he or she is entitled to a refund of any instalments they have paid.
HomeSmile aims to provide customers with a high quality service at all times. The company deals with complaints extremely seriously and will implement a full and robust investigation into all complaints to achieve positive outcomes for our customers.
Contact head office on: 0121-522-4687