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BrightHouse – will you get a refund? Should they be larger?

Brighthouse - scary prices - has to refund customers 2017BrightHouse, the pay weekly store which charges high prices and very high interest rates, is being made to refund £14.8 million to customers by its regulator, the FCA.

BrightHouse prices are often extremely high and the charges for insurance and interest make the total cost paid massively more than what a similar item in a normal shop would cost – as my “improvement” to BrightHouse’s current Halloween promotion above points out.

So the refunds are good news. But do they go far enough?

The true cost of a washing machine from BrightHouse

This 2016 report gives an example:

BrightHouse: Cheapest washing machine (with the mandatory 5 star service) is £471.00. Purchased using weekly repayment over 3 years (69.9% APR), it would cost £936.00 (or £1,056.12 with the optional product insurance, which is required if user does not have contents insurance).

Alternative: Cheapest similar product on high street is £249.99 (or £349.97 with delivery, disposal and 3 year
breakdown plan). Purchased using a weekly loan from a Credit Union over 3 years (42.6% APR), it would cost a total of £491.19.

There are also much cheaper “pay weekly” alternatives available, such as Fair For You.

Will you get an automatic refund?

BrightHouse will be writing to two groups of people offering refunds. If you are in one of these groups, you don’t have to do anything now, just wait for a letter.

People who were sold items without proper affordability checks

BrightHouse should have made checks that customers would be able to afford the repayments for the goods they were buying. These checks were often not very good!

BrightHouse has identified 81,000 customers who should not have been sold 114,000 items. If they returned the goods because they were struggling, they will get a refund of the interest and fees charged under the agreement, plus compensatory interest of 8%.  If they kept the goods but still owe a balance, they will have their balances written off.

This compensation totals around £10.1 million so that will be an average refund of £125. These affordability refunds are only being given for purchases between 1 April 2014 and 30 September 2016.

People who were not given a refund when they cancelled an order

181,000 customers from April 2010 cancelled an order within the 14 day period allowed but never had a refund of the first payment they had made. BrightHouse will refund this first payment plus pay compensatory interest of 8%.

This compensation totals around £4.7 million for 270,00 agreements, as some customers will be due a refund for more than one item – the average refund will be about £17.

What if you don’t get an automatic refund?

There are two groups of people who may have a case for a refund who aren’t going to be offered one.

First, people who had affordability problems before April 2014. This date was picked because that was the point when the FCA became BrightHouse’s regulator. But before then they were regulated by the OFT who had pretty much the same rules on affordability as the FCA does. So why shouldn’t they get a refund too?

Second, there may be people who had affordability problems after 2014 who weren’t detected by whatever filter BrightHouse was using to determine who gets a refund.

This is similar to the automatic refunds that the FCA made Wonga give in 2014/2015. Great for those people that got them, but there are tens of thousands of people who have been successfully complaining about Wonga’s payday loan affordability since then who either had problems before 2014 or who weren’t included in the automatic trawl for some reason.

If you want to complain, here is a template letter to BrightHouse to help.

I have moved some comments from this article to that new one as it is more up to date. I have turned off commenting on this one.

More Debt Camel articles:

BrightHouse – a debt to avoid

Can’t pay a bill? Make an arrangement to pay

News snippets about high-cost credit

 

Comments

  1. I have just contacted customer relations at brighthouse and they have confirmed to me that i am on the list of people to send letters too will just have to wait and see what they offer and how long it takes

    • What number did you contact them on Steve?

      EDIT – They have a new helpline number: 0800 30 40 80

    • at one time i was paying 207.00 a week to bright house i currently pay 112.00 so i will have to wait and see what happens it would be a nice christmas present if it was sorted by then

  2. I have goods from Perfect Home which operate in much the same way I believe. The interest payments are extortionate but at the time I had no real choice, my washing machine and fridge failed completely and no one else would accept me as I have CCJ’s. I ended up defaulting several times on my weekly payments as they were really high and they simply kept extending the contract for me. Does this complaint apply simply to BrightHouse or is it worth complaining to Perfect Home a similar company?

    • It may well be worth complaining to Perfect House … I will be writing an article on how to complain to BrightHouse in the next week or so, so perhaps look out for that?

      • Hi I have 4 loans with bright House I bought a TV which was broken when it arrived so was told to go into the branch to choose another refurbished TV, which I did !
        The other one was over 2 years, I was asked if they upgrade due to my problems could I afford a extra £1 a week which I said yes ,
        In the meantime I moved to another area and was told I needed to go to another store nearer me to sign all the contracts again which I did
        Only to find out the Bright House had not done me any favours they had changed my payment plan to. 3 years for a used TV, unfortunately I signed with out reading the contract !

        • Are you saying they changed a 2 year contract – which you were part of the way through – to a 3 year contract without you asking for this? Unless your payments dropped quite a bit, I think that is grounds for complaint.

    • I have two items I’ve taken out from Perfect Home I’m still paying pls let me know it they would be issuing a refund

      • I havnt heard anything about PH so probably not doesnt say that they wont be in same boat as BH in future though

        • Will be interesting to see if Perfect Home will be looked at because they operate in exactly the same way with extortionate weekly interest rates. I’ve defaulted on payments 4 times as I struggle and they just keep tagging it on to the Lending time extending the contract

  4. Can I complain from items before 2014? And does it include of you were forced insurance? X

  5. I had a fridge freezer in 2014 still paying it now a 300 pound fridge in Argos = to a 1189 pound fridge will i have any money back I would never go to brighthouse again only I was desperate with 2 young children

    • Sorry I didn’t see your comment earlier. You can phone their helpline 0800 30 40 80 and ask if you are going to get a refund. If you do, could you post here saying how much? That would be great help to other people.

  6. Iv been a customer with Brighthouse for years I have took out a few items from them in that time frame I pay 133 a wk to them some items are paid off will I be entitalied to a refund from them

  7. Does this refund only apply if you gave the goods back? What if you struggled and kept the goods and paid in full?

    • That is why I don’t think the refunds being offered go far enough… see the post I will be writing in a few days.

  8. I will be looking to send a letter of complaint to brighthouse as I took an item out with them in 2014 although it was just before the FCA took over. When I made the application all I was asked for was my payslip for the affordability factor and I believe I’d they had asked for bank statements, it would have shown that at the time I was already struggling with debt. I even remember once when I was late making a payment I then had to fill out a form showing my payments each month and because it then showed that affordability was an issue they asked me to change it so that it showed that I could afford the item rather than take the item from me. I have since paid the item in full and will no longer be dealing with them but find it a bit unfair that people who have paid off items and still had affordability issues are not being looked at also

  9. I contacted brighthouse today to ask exactly what the situation is regarding the financial problems myself and other customers have faced as i felt it wasnt fair for someone who returned the item is being looked at but not the other way round when paid in full.I was told that the FCA have looked at all accounts during the dates mentioned and i was told regardless if you returned the item or paid in full it doesnt matter if there wasnt affordability checks made you will get some kind of payment.

    In my opinion i think that the £15m is way not enough just because the FCA took over in 2014 that is it.Brighthouse has made a lot of money a lot more than on offer what about the fees for example sometimes i paid nearly £100 in late payment as i had 22 accounts maybe people should do something about the OFT as it seems they have got away with this scandal but one good thing is at least the FCA have done something to protect customers.

    • Maybe its the beginning of brighthouse closing look at the payday loan situation ,banks ,ppi etc buy as you view have gone and perfect home in in problems i have noticed stores closing so if we all fight them we may win.Once my account are clear in may thats it for me it became to easy to get items not thinking about my financial situation until it was too late.

  10. Hi quicky question is it per agreement that u gonna get paid or just one payment as a whole regardless how many items you have

    • the calculations will be on each agreement, but if you have several I think they will be added together into one payment.

      • Yeh thats correct Sara thats what they told me but they also it more than likely wont be all just ones they deem not enough checks.TBH i cant see much in the payments amount as 250000 sharing £15m doesnt really leave much to have a good share that will be worth while

        • See the numbers in the article – there are a large number of small refunds, where the customer had probably only paid one payment. The affordability refunds will be larger.

  11. I contacted brighthouse about a complaint and the refund I have been with them for years never a missed a payment or a late payment ever. I spoke to a manager called Ian and told him I was not making any more payments until the complaint and refund were fixed. There manager then say’s if I don’t keep up with my payments they where going to Black my credit listing are they into Blackmale now.

    • Have Brighthouse said you are on the list for a refund? These items you have bought on HP, if you don’t make the payments they can repossess them… If you win an affordability complaint, any adverse marks on your credit record should be deleted, but if you don’t win, they won’t be. I think you should consider going to your local Citizens Advice and asking for their help if you feel you have to stop making the payments.

  12. I brought a sofa from BrightHouse I am still paying for it . The agreement finished in August 2018 . The cushions have all gone flat when I phoned them they weren’t interested even though I took out insurance as an added extra . They told me they would do nothing as they said it’s wear and tear . And they offered me more credit today by txt message . No thanks .

    • They just told me no even though I took out the agreement in 2015 and it doesn’t end until September 2018 .

  13. What if you have had items and returned them several times and now still have items and they have stopped harassing you for payment, also 2 items needed repairing and the third item a fridge has a faulty shelf.

    • Its funny you should mention that when i spoke to the gentleman on the phone he told me theres 3 things the 2 mentioned everywhere on the news returns and affordability checks and the skippers.I am sorry if it sounds a harsh it aint meant too but if you are no longer paying for the goods you received i would guess thats classed as a skipper and he stated that they would be dealt with differently.

      you could give them a ring for a heads up to see what your position is
      I hope this helps you

  14. Ahh I was never a skipper for 18 months I kept my payments up but I had 2 faulty TVs returned, a faulty cooker exchanged, the affordability wasn’t done correctly(never refunded on faulty returns) also they carried the finance over on other items. So we could say we’re even lol

    • you never know i maybe wrong just going by what the guy said your situation could be totally different to a person who just got goods and just didnt want to pay you may get something.I would recommend maybe giving them a ring on the number on the comments the worst they can say is no.

  15. Just a big publicity stunt it’s costs us to ring to be told your account has been looked into and your not on the list ,so someone has been through all of my accounts with out my say so and can see all of my incomings outgoings !!!! nice one sounds safe to me ha ha haaa.Oh and you can put in a complaint if you think you should be due some back but he told me over the phone nothing will be done about it decision has been made

    • The phone number is a free 0800 number.

      “so someone has been through all of my accounts with out my say so and can see all of my incomings outgoings ” no they haven’t, Bright House has made what it hopes is a good guess and has based it’s payouts on that. It is exactly because it may not have got these right that people may want to make complaints.

      ” he told me over the phone nothing will be done about it decision has been made” that is just wrong. BrightHouse will have to consider any complaints and you can send them to the ombudsman if they reject yours. It costs nothing to do this and it’s easy.

      Do you remember Wonga were made to send massive refunds to people a couple of years ago? They didn’t get all those right and now that are being made to payout on complaints by the ombudsman.

  16. I have a question for you Sara why cant the OFT be help responsible for not having any control and agreement should be backdated to when they operated brighthouse agreements

    • I have no idea if the FCA could have made Brighthouse pay out on loans from when it was regulated by the OFT not the FCA, but that legal issue probably doesn’t matter because people can still make complaints about older loans to the Financial Ombudsman.

  17. Question, if you have had items from BrightHouse then returned and replaced them with cheaper products, they carried out 4-5 agreements because I couldn’t afford to pay. How does that work

  18. i spent a lot of money at bright house over the years had loads of things at this very high interest but i think it was before 2010 can i still get a refund if not why i was still a customer

    • The Financial Ombudsman has a rule which says a complaint has to be brought within 6 years. Although I am sympathetic, I have to be realistic and say I really doubt older complaints would succeed.

  19. So has anyone else got a payment from them as yet .Apart from the 1 lady i haven’t heard anything about anyone else.I have heard and if its true or not i dont know but they seem to be instead of paying cash out they are trying to clear accounts with very minimal weeks left if the balance is around the same as payment another blag from brighthouse if its true.

    • Because of the timescale of the purchases they are refunds, it is inevitable that many of them will have a balance owing rather than have been paid off. If there is a balance owing, any “refund” will be used to reduce this.

      • I still think due to customers paying an obscene amount for a while they should be given the choice would you like them paid off or a cheque etc as it keeps the money in the company if they do it this way

        • Realistically that isn’t going to happen – it doesn’t happen with PPI refunds or payday loan affordability refunds if there is a balance outstanding. And anyway the problem is the unaffordable nature of the existing loan repayments, reducing those has to be a priority.

  20. Hi,I’m not sure where I stand,I had a tv in 11/12 I I moved in 2013 and changed bank details and I never heard off them again?? Any help and advice please.

    • I don’t think you will be getting one of the refund letters – if you phone up the helpline (number in article above) they will be able to tell you if you are on the list for a refund. If you aren’t and you don’t think that’s fair, read this new article on how to complain: https://debtcamel.co.uk/brighthouse-refund-complain/

      (PS sorry for late reply, your comment went into spam – no idea why!)

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