How do you vary the terms of your car finance agreement is a question that arises frequently. With many people, the ongoing cost of living problem has seriously affected their finances. They have cut back all they can, but now need some more help.
Are they able to take a payment holiday or defer some car payments until things improve when they are more financially secure? Can they vary the terms of car finance agreement to bring the monthly payment down?
Is there anything I can do to change my terms and help?
There is no Government support that covers car finance
This is a demanding situation so is there any support scheme. Unlike the government’s support for energy costs, there is no government support scheme to cover car finance during the cost-of-living crisis. But that doesn’t mean that no help is available.
Take advice and communicate with your car finance provider
At the discretion of your finance provider, you may be able to come to an arrangement that helps you in the immediate term. While we don't know and so can't advise on the specifics of any help you may be able to get. We recommend that you reach out, get in contact, and understand from your finance providers what options are available to you. Communicate any concerns you have about your financial position and discuss if there are any options available to you. Whether that's payments, varying terms, or anything else.
Can I vary the mileage allowance?
What about mileage allowance in the agreements? My car is sat not going anywhere so what can I do? Some finance providers may allow amendments to mileage limits. But it depends on the original agreement. How long you have had use of the vehicle. And how long remains on the agreement. If you were expecting to be doing many miles over the past few months but have been forced to/ chosen to work from home, then you may be well under any mileage agreement that’s in place. The best advice is to talk to your car finance provider and see what approach they take.
When is the best time to negotiate a change to a car finance agreement?
Your need to work from home and the need to travel again may happen, meaning a different mileage agreement change is required. You could make a change now, only to need to change it again later. Some of us may find that we are pushed to travel more to catch up with lost business and find that we make up the miles that we may have saved so far. Not only is it worth waiting, but it also may not be worth making the change. Or even possible, depending on the type of finance you have.
If you are on a PCP deal for example, the lower the mileage of your vehicle, the more equity you are likely to have built up by the time your contract ends. So there is no need to reduce the mileage limit in the short term.
Take professional advice before you decide on making an alteration to your car finance
In all situations, where you are looking for ways to tighten the belt. If you are wanting to make alterations to your vehicle finance agreement. The advice is to take a broad look over the past months,and try to estimate forward. Make the best judgement for your own situation today and in that future as best you can. And then if you want to proceed with understanding what options are available to you, reach out to your finance provider to discuss what options are available.
At Tyson Cooper we can advise on all aspect of car finance, especially to our partner organisations which include, M & S, Xexec, RIBA, RICS, ICAEW, Fran Farmers, BASC, IMechE, BASC, Aspatria Farmers, National Farmers Union, Suffolk Agricultural Association
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