Rent-to-own retailer BrightHouse collapses

Accountancy firm Grant Thornton has been appointed as the administrators of Caversham Finance Limited, which trades as BrightHouse in the UK.

BrightHouse – which has more than 240 stores in the UK – allows customers to spread the cost of household items (such as appliances, tech and furniture) over an extended timeframe using high-interest credit. It means that customers usually end up paying much more for the items than if they'd paid for them outright.

In 2017, BrightHouse was ordered to pay back £14.8 million to almost 250,000 customers after an investigation by the financial regulator found it had failed to be a "responsible lender".

Subsequent shop closures in light of coronavirus restrictions pushed the retailer into administration.

The administrator says that there will be no new rent-to-own or cash loan lending. It says that all outstanding rent-to-own and cash loans remain subject to the original agreed terms, and that customers should continue to make payments in the usual way. It's worth noting it's not charging any late fees or interest on missed payments at the moment due to the coronavirus pandemic, and that you should get in touch with it if you're struggling.

What if I have a warranty or insurance claim with BrightHouse?

BrightHouse's administrator says that servicing, warranties and insurance claims will continue to be provided until further notice for essential items and smaller courier deliveries. But this is subject to continuous review, so could be pulled at any point.

What should you do if you're currently paying outstanding money to BrightHouse?

BrightHouse says that if you find yourself unable to make payments for an item you currently have, you should make contact by visiting its website and completing the online form, or by calling on 0800 526 069 and selecting option two.

Sara Williams, founder of debt help website Debt Camel, said: "BrightHouse – like almost all lenders – is asking people to get in touch if their finances have been hit by coronavirus. If you're struggling, ask for a payment break – BrightHouse says you won't be charged extra interest or fees because of this."

"If you have had several items from BrightHouse, think if you may have a good affordability complaint. The regulator says BrightHouse should have checked you could afford to buy the items and also pay all your other bills, expenses and debts. So if paying BrightHouse caused you hardship or to get deeper into debt, send them an affordability complaint and you may get a refund of the interest you paid.

"When you are currently buying something and you have a strong affordability complaint, it may be best to stop paying as you have the right of set-off between what you owe them (for the goods) and what they owe you (a refund of the interest you paid). If you aren't sure, talk to National Debtline on 0808 808 4000."

It's worth noting that while it's theoretically possible that if you don't pay for an item that you don't own outright yet, the item could be taken back by the administrator, this is very unlikely, particularly at the moment while the coronavirus pandemic is ongoing.

What about returns?

We've asked Grant Thornton if return rights will be affected now that BrightHouse has collapsed – we'll update this story once we have full details.

What if you've got a complaint?

Customers with complaints can contact BrightHouse as normal by calling the customer relations team on 0800 526 069 or by using BrightHouse's website.

If your complaint relates to an affordability claim for a previous agreement, Grant Thornton says it will be in touch in due course. Bear in mind that usually when firms go into administration like this, complaints are put on hold for a long time, so it may be a while before you hear anything back.