Credit - early settlement explained
(for all nations)
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Early settlement is the term used when you pay off a credit agreement before it is due to end, which entitles you to a proportionate rebate on the interest payable on the agreement.
The law provides that debtors can settle their agreements early, provided certain conditions are met. There is a list of ten conditions including that the agreement is regulated under the Consumer Credit Act, and that the debtor pays the amount owing in full.
Under section 97 of the Consumer Credit Act, the debtor is entitled to know how much he/she has to pay in order to clear the debt. There are specific rules in relation to the amount and calculation of the rebate, and how to request a settlement figure.
