Rules for buying movable goods in installments

Automatic summary, not yet reviewed

1. The law regulates installment sales of identifiable movable goods (with brand and serial number), loans to finance them, and the related guarantees. It also covers any arrangement that pursues the same economic goals, whatever its name.
2. If a contract also falls under the Consumer Credit Law, the rule that favors the consumer most applies, and this law applies only as a supplement.
3. The contract must be in writing and include mandatory details: cash price, installments, interest rate, annual percentage rate, ownership reservation if any, and the right to withdraw. If key details are missing, the debt is reduced: for example, with no interest stated, only the legal interest is due.
4. The consumer can withdraw within seven business days after receiving the goods, if they were only examined or tested and are returned in their condition. The consumer can also pay early, with a maximum compensation of 1.5% or 3% depending on whether the interest rate is variable or fixed.
5. If the buyer misses two installments or the last one, the seller can demand all pending installments or cancel the contract, with set compensations. Judges can, for fair reasons such as unemployment or illness, set new deadlines or reduce penalties.
6. Ownership reservations and bans on selling only bind third parties if recorded in the Register of Installment Sales of Movable Goods, kept by Property and Commercial Registrars. Contracts recorded in the official form give the creditor a special collection procedure aimed at the goods, including auction.

Who it affects

• Consumers who buy movable goods in installments or take a loan to finance them: They get a written contract with mandatory details, a seven-business-day withdrawal right, and a lower debt if details are missing.
• Sellers offering installment sales: They must follow the required forms and clauses and can demand payment or cancel the contract if the buyer misses two installments.
• Financiers and credit institutions: They can record their rights in the Register and use a special collection procedure against the goods.
• Financial leasing companies: They can record their contracts in a special section of the Register and recover the goods if the lessee does not pay.
• Property and Commercial Registrars: They keep the Register of Installment Sales of Movable Goods under rules set by the Ministry of Justice.

Words worth knowing

Bienes muebles corporales

Physical items that can be moved, such as a car or a TV, unlike an apartment or land.

Reserva de dominio

Ownership reservation: the seller stays the owner of the goods until the buyer pays the full price.

Tasa anual equivalente

Annual percentage rate: the figure showing the real yearly cost of a loan, including interest and fees.

Desistimiento

Withdrawal: the right to cancel the contract and return the goods within a set period, without giving reasons.

Arrendamiento financiero

Financial leasing: a rental contract where the lessee pays installments and can usually keep the goods at the end.

It summarizes the law as published in the BOE. It is written by artificial intelligence and may contain mistakes: the official text is what counts. Read the official text · How we make summaries