Martin Lewis was back on television on Thursday night offering financial advice and guidance to viewers on several coronavirus-related topics.
In another special edition of The Martin Lewis Money Show, live from his London home, the financial guru issued updated guidance for motorists across the country.
The founder of MoneySavingExpert.com revealed that if you have a car loan, Personal Contract Purchase (PCP), leasing or HP deal, a three-month payment holiday should be available on request.
On Friday morning, the Financial Conduct Authority (FCA) confirmed its proposed package of measures to support drivers facing payment difficulties because of the coronavirus pandemic. These include:
Firms should not take steps to end the agreement or repossess the vehicle
Firms should not change customer contracts in a way that is unfair. For example, firms should not try to use temporary depreciation of car prices caused by the coronavirus situation to recalculate Personal Contract Purchase (PCP) balloon payments at the end of the term. We will expect firms to act fairly where terms are adjusted
Where a customer wishes to keep their vehicle at the end of their PCP agreement, but does not have the cash to cover the balloon payment due to coronavirus-related financial difficulties, firms should work with the customer to find an appropriate solution
The measures will come into force on Monday, April 27 and customers should be able to request a payment deferral at any point after this for a period of three-months.
The FCA has already put payment holiday schemes in place to protect people with credit cards, overdrafts, store cards and catalogue debt.
It has also given private renters protection from eviction and mortgage payment freezes for homeowners if their income is affected by the Covid-19 crisis.
Until the measures officially come into force, Martin advises motorists to speak directly to their car finance company as they may be able to start the payment holiday early- but warned viewers only to do this if there's no other option, as interest will still rack up.
Commenting on the FCA measures, Justin Basini, CEO and Founder of ClearScore, said: “The reality of Covid-19, the lockdown and the effect it’s having on employment rates and the economy means there is a huge and currently immeasurable impact on the UK population’s personal finances.
“According to ClearScore’s data from over 9 million UK consumers, the average loan value in the UK today is £10,132 and the outstanding credit card debt value is at £3,084.
“While the UK Government and the FCA are working hard to introduce schemes and policies to support individuals, many are slipping through the cracks.
"I would encourage banks, lenders, and financial institutions of all kinds to do everything in their power to support their customers during this difficult time with tailored products, payment freezes and advice.”
