As of Monday 27 April, people with car finance plans can receive a three-month payment window.
The FCA has asked for lenders to support borrowers and offer payment holidays. The guidance includes:
For borrowers financially effected by coronavirus, car finance lenders will have to offer a three-month payment holiday, which permits the customer to make no payment to their contract. However, interest will still accrue during this time.
If a payment holiday isn’t suitable. For example, borrowers may be already in arrears, lenders will be expected to offer other solutions.
Repossession of vehicles
For borrowers struggling financially because of coronavirus, lenders will not be able to repossess their vehicle.
Where any of the above may apply and the lender draws up a new agreement with the borrower, the FCA has called for lenders to not take advantage and make any significant changes to the contract.
For further information, visit the FCA website.