Credit Contracts and Consumer Finance Act 2003

Repossession of consumer goods under consumer credit contract - Rules that apply after repossession of consumer goods

83ZH: Extinguishment of creditor’s security interest and subordinate security interests on sale

You could also call this:

"What happens to loans when you sell something you bought on credit"

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When consumer goods are sold under section 83Z or 83ZF, some interests are extinguished. You need to know that the security interest of the creditor who sold the goods is extinguished. The security interests that are subordinate to the creditor's interest are also extinguished. If you want to know more about security interests in the proceeds of the consumer goods, you can look at the Personal Property Securities Act 1999. This Act has information about what happens to security interests when goods are sold. You can find more information by following the link to the Personal Property Securities Act 1999. The sale of consumer goods affects the interests of the creditor and others. You should look at the relevant sections to understand what happens to these interests. The law is in place to protect your rights when buying and selling consumer goods.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM6501400.

This page was last updated on 1 January 2026 — View changes

Topics:

Money and consumer rights > Consumer protectionMoney and consumer rights > Banking and loans

83ZG: Disposal of consumer goods to purchaser for value and in good faith, or

"Buying goods from someone without getting their debts"

83ZI: Creditor to give statement of account to debtor, guarantor, and other interested persons, or

"Creditors must give you a statement of account after selling your goods."

Part 3ARepossession of consumer goods under consumer credit contract
Rules that apply after repossession of consumer goods

83ZHExtinguishment of creditor’s security interest and subordinate security interests on sale

If consumer goods have been sold under section 83Z or 83ZF, the following interests are extinguished on the sale of the consumer goods:
the security interest in the consumer goods of the creditor who sold the consumer goods:
all security interests in the consumer goods that are subordinate to the security interest of the creditor who sold the consumer goods.

See the Personal Property Securities Act 1999 in respect of security interests in the proceeds of the consumer goods.

Notes

Section 83ZH: replaced, on 1 June 2020, by section 29 of the Credit Contracts Legislation Amendment Act 2019 (2019 No 81).