PCP payment holiday
Discussion
Possibly. I sort of work in finance and I know a couple of people at the larger finance houses.
The main discussions between themselves in the forums at the moment is do they have the cash flow to stand payment holidays. Lots of them concerned that they don’t have the necessary reserves in hand.
Many of them looking at the value of the asset vs remaining payments and trying to decide if the default rate (where no holiday is offered) means they can sell the assets and clear more.
The main discussions between themselves in the forums at the moment is do they have the cash flow to stand payment holidays. Lots of them concerned that they don’t have the necessary reserves in hand.
Many of them looking at the value of the asset vs remaining payments and trying to decide if the default rate (where no holiday is offered) means they can sell the assets and clear more.
eltax91 said:
Possibly. I sort of work in finance and I know a couple of people at the larger finance houses.
The main discussions between themselves in the forums at the moment is do they have the cash flow to stand payment holidays. Lots of them concerned that they don’t have the necessary reserves in hand.
Many of them looking at the value of the asset vs remaining payments and trying to decide if the default rate (where no holiday is offered) means they can sell the assets and clear more.
Probably reading it wrong so sorry if that's the case... From the last paragraph it sounds like they are considering that financially it may cost them less / make more business sense to let people fall behind, repo the cars and sell them rather than let people delay payments for a bit? If so i get that companies have to make profits and survive but at the moment its not really in the spirit of things.The main discussions between themselves in the forums at the moment is do they have the cash flow to stand payment holidays. Lots of them concerned that they don’t have the necessary reserves in hand.
Many of them looking at the value of the asset vs remaining payments and trying to decide if the default rate (where no holiday is offered) means they can sell the assets and clear more.
Gluggy said:
Probably reading it wrong so sorry if that's the case... From the last paragraph it sounds like they are considering that financially it may cost them less / make more business sense to let people fall behind, repo the cars and sell them rather than let people delay payments for a bit? If so i get that companies have to make profits and survive but at the moment its not really in the spirit of things.
Correct. You’re not reading it wrong. Some Are looking at marking their databases so the customer services staff refuse a payment holiday for those where a default will mean the finance co gets to retain more value. The big gamble is on residuals. Nobody knows really what residuals are right now. And what they might be in future. Storing cars is not really their game
Gluggy said:
Probably reading it wrong so sorry if that's the case... From the last paragraph it sounds like they are considering that financially it may cost them less / make more business sense to let people fall behind, repo the cars and sell them rather than let people delay payments for a bit? If so i get that companies have to make profits and survive but at the moment its not really in the spirit of things.
Then, with respect, I'm not sure you're totally getting the 'companies have to survive' thing.eltax91 said:
Correct. You’re not reading it wrong. Some Are looking at marking their databases so the customer services staff refuse a payment holiday for those where a default will mean the finance co gets to retain more value.
The big gamble is on residuals. Nobody knows really what residuals are right now. And what they might be in future. Storing cars is not really their game
Interesting but in order to realise the asset value there has to be market for it and right now the trade isn't buying cars so they repossess the car but have no way of realising its value (other than a fire sale) so still have the issue of the debt they have on the car, remember these guys aren't lending their own money they are in debt as much as the guy who took the loan, also who is going to do these mass repossessions? The country will go further into lock down so that will not be an option. The big gamble is on residuals. Nobody knows really what residuals are right now. And what they might be in future. Storing cars is not really their game
Any finance provider that has over reached themselves is in as much trouble than the guy the who took on the loan...more trouble really.
iphonedyou said:
Then, with respect, I'm not sure you're totally getting the 'companies have to survive' thing.
No offence taken 
If it's not viable for the company to offer a payment holiday then sadly it is what it is but if they can then the decent thing would be to so - if they can afford it but decide that "forcing" people to default would cost them less than the payment holiday then that's a bit below the belt.Wills2 said:
Interesting but in order to realise the asset value there has to be market for it and right now the trade isn't buying cars so they repossess the car but have no way of realising its value (other than a fire sale) so still have the issue of the debt they have on the car, remember these guys aren't lending their own money they are in debt as much as the guy who took the loan, also who is going to do these mass repossessions? The country will go further into lock down so that will not be an option.
Any finance provider that has over reached themselves is in as much trouble than the guy the who took on the loan...more trouble really.
Let’s remember that if they refuse a payment holiday, it’s not likely a mass of people will default immediately is it? They’ll be spread out of a few months at least and probably won’t start to really happen for a while, most people have been paid for February and March. Lockdown will be gone by then so repossession won’t be an issue. Any finance provider that has over reached themselves is in as much trouble than the guy the who took on the loan...more trouble really.
They also don’t have to sell right away. They only have to find it short term and try to spread the selling out.
The line is very thin, and for what it’s worth I think mostly they’ll fall down on the side of helping customers. Not least because nobody wants to be the only company to start repo’s, as they’ll be all over the media and standing alone to take the brand damage.
Hire Purchase possibly, with PCP id doubt it.
Its in breach of the terms residual wise and makes it extremely difficult for them to extend the term and add on the interest payments.
Plus the residual market at the moment is already into a complete unknown, im sure the finance houses would much rather have the car in and sold at whatever its worth now than taking the risk on 3 months time.
Its in breach of the terms residual wise and makes it extremely difficult for them to extend the term and add on the interest payments.
Plus the residual market at the moment is already into a complete unknown, im sure the finance houses would much rather have the car in and sold at whatever its worth now than taking the risk on 3 months time.
vrtrooper said:
Instead of a payment holiday, what about the option to pay 50-80% per month and extend the period to cover it.
Only an idea, I'm clueless on PCP etc.
Or you could argue that you are clueless if you signed up to a 3-5 year commitment to pay a monthly amount and think that someway into the agreement you can start paying less or not at allOnly an idea, I'm clueless on PCP etc.
aka_kerrly said:
Or you could argue that you are clueless if you signed up to a 3-5 year commitment to pay a monthly amount and think that someway into the agreement you can start paying less or not at all
Dodgy ground, but it seems like another good reason to not have what you can't really afford!Mr Tidy said:
JxJ Jr. said:
Quite. Which is why it might be worth laying off judgements such as "...not really in the spirit of things...the decent thing would be to...".
But isn't that what got people to this potential scenario in the first place? 
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