Friday, 30 January 2009

Be wary with your cash

Customers who want to avoid being left in the lurch when a store goes bust should make sure they buy wisely.

Chris Detheridge, who is based at our offices in Euston Way, Telford, said: “As the recession deepens, experts are predicting that up to 200 shops a day may close this year. This means more and more people could find themselves struggling to get their hands on goods they have already paid for if a store goes under.

“And the bad news is that customers have surprisingly few rights if a firm disappears, so it’s vital to think carefully about what you buy and how you buy it.”

Administration is a legal process that lets companies and individuals claim some or all of the money they are owed by the firm that has gone bust.

“But the problem arises when there are not enough assets to pay off everyone, and the amount of protection you have in this situation will depend on how you bought the item.

“If you paid for something with cash but the goods were never delivered, you will have to go to the administrators for a refund. Your purchase may well be packed and clearly marked with your name in a warehouse somewhere. If so, you are entitled to receive the item as ownership has technically passed to you.

“The best protection will be available if you paid for the goods on credit, either by credit card or with in-store finance. This will mean you can claim back the value of any item worth between £100 and £30,000 directly from the credit company.

“Given the current climate, be wary and think carefully before you make any major purchases – you don’t want to risk your hard-earned cash in these difficult times.”