COVID-19 & Car Repayments: How do the New Rules Affect Me?

COVID-19 & Car Repayments: How do the New Rules Affect Me?

31/07/2020

With the financial disruption caused by COVID-19, many will be considering how they can cut down on their monthly outgoings.

Thankfully, help is at hand. According to FCA rules, since Monday 27 April 2020, individuals struggling financially due to COVID-19 can ask for a three-month payment freeze on car finance payments. If you can’t agree a repayment plan and need further support, the FCA has extended help for a further 3 months.

For those who are yet to request a payment freeze, the time to apply for one will be extended until October 31.

During this time, lenders will also be unable to repossess vehicles or end agreements if you’re having difficulty paying because of COVID-19.

As with many similar measures, it is important to note that if you do take a payment holiday, interest will continue to accrue over this period. If you can afford to make your repayments, therefore, it would be advisable to do so.

These rules cover many kinds of vehicle finance including Hire Purchase, Personal Contract Purchase, leasing deals and other finance deals secured against a vehicle. They also extend beyond cars to vans and motorbikes.

While these measures will help many during this difficult time, for some, they will not be enough to fix long term problems with debt. If you would like advice, we are here 6 days a week. Contact us now on 0141 300 5656 or book a call-back below.

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