Rules for lay-bys

A lay-by is an agreement between you and a customer where you:

• agree on a fixed sale price and payment conditions
• hold the goods until the customer finalises the payments
• do not charge interest on the outstanding debt.

The lay-by can be anything from 1 week to many months. You and the customer are free to decide. You will then hold the goods for that period of time.

An agreement is a lay-by if:

• the customer pays in 3 or more installments
• you call it a lay-by, even if the customer pays in only 2 instalments.

Terms and conditions

When you start a lay-by agreement, you must make sure the customer knows the terms and conditions.

Agreements must be in writing and should contain:

• what goods you’re selling
• how much they cost
• how much deposit the customer paid
• how long the lay-by will last (maximum)
• what cancellation and refund policies apply.

Cancelled lay-bys

The customer cancels

If the customer cancels a lay-by agreement, you:

• must refund the customer’s money
• may charge a termination fee only if it was in the agreement.

A termination fee can only cover the costs of the lay-by.

You cancel

You aren’t allowed to break a lay-by agreement unless:

• the customer breaks one of their terms
• you close down
• the goods are no longer available for reasons you can’t control.

You can’t choose to remove the goods from sale.

The customer is entitled to a full refund if:

• you close down
• the goods are no longer available for reasons you can’t control.