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The Consumer Rights Act gives the trader (the finance company) one chance to repair before a customer can reject (after 30 days). In practice, this is a very useful right. The finance house often knows nothing of any issue until the customer stops making payments, or becomes so exasperated that he/she calls the finance company, and at this point you will want a chance to put things right.

You will want to avoid a situation where that right is lost because the dealer has already tried and failed to fix the issue and the trader acted as your agent when attempting repair.

In my view, finance houses should exercise caution when liaising with dealers and customers to arrange repairs in complaints cases.

Consider the following steps to ensure the dealer is not acting as your agent and please note there will often be cases where you do knowingly authorise the dealer to carry out repairs:

• avoid referring customer’s routinely back to a dealer for repairs to take place before you have acknowledged and considered the complaint
• avoid any standard wording in policies or standard letters referring customers to the dealer
• ensure that your terms and conditions do not direct a customer routinely back to the dealer
• ensure all complaints staff are fully trained in relation to the one chance to repair and CRA remedies – for example we often see a lack of understanding around warranties.

In our experience, the Financial Ombudsman will often look very broadly at what has been done to assist the customer and will not simply consider a strict interpretation of the Consumer Rights Act.  Always make sure you are treating customers fairly and if in doubt, take advice!

Dealers