Helping our customers during coronavirus

How to ask for a payment holiday

If you’ve had a payment holiday for 3 months or more and you cannot restart your payments, you may be able to extend your payment holiday to a maximum of 6 months.

Your payment holiday can be extended by one month at a time. This will include the Payment Holidays that you have taken so far. Any additional payment holidays must start straight after your current payment holiday and must finish by 31 July 2021.

If you don't ask us to extend your Payment Holiday again, we'll assume that you can start making your payments.

Before extending your payment holiday, you should think about whether you can start your payments again. When you take a payment holiday, you pay more overall as it takes longer for you to pay back the amount borrowed. The longer your payment holiday, the more you pay. You may also incur extra vehicle related costs if you keep the vehicle for longer.

If you’ve had a payment holiday for 6 months and you can't restart your payments, contact us on 0333 202 7967 to discuss your options.

Are your money worries longer term?

A payment holiday can help if you need to take a short break from making your payment. This may be due to a short-term loss of or reduction in your income or your household income. If your money worries are longer term, please call us on 0333 202 7967 so we can discuss if a payment holiday is right for you.

To give you the best support when you call us, please have details of your income and expenditure handy. This may include your wage slips, bills and bank statements.

If your payment is due within 5 days, you won’t be able to have a payment holiday for this payment.

If you can't make the payment, you can stop it by speaking to your bank and asking them not to pay the Direct Debit. You'll then need to call us on 0333 202 7967 so that we can discuss your options with you. We may able to back date your payment holiday to cover your missed payment.

If you are more than two payments behind, you may not be able to have a payment holiday. Please call us on 0333 202 7967 so that we can discuss other ways that we can help.

How a payment holiday works

A payment holiday can help if you need to take a short break from making your payments due to a short-term change in your income. If you're worried the impact may be longer term, a payment holiday may not be right for you. Please call us on 0333 202 7967 to talk about other options that could help.

If you defer your payments by 3 months, this means that you won't make a car finance payment for 3 months. If you defer your payments by 6 months, you'll not make any payments for 6 months.

You'll pay more as you take longer to pay back the amount borrowed. We'll work out how much extra you'll need to pay and we will add this to your agreement.

We'll work out how much is due by using the interest rate shown in your agreement. The extra amount won't be more than £100 for each month that we defer your payments. This means if you take a 3 month payment holiday, the extra amount won't be more than £300. If you defer your payments by 6 months, the extra amount won't be more than £600.

You'll be asked to pay the extra amount the month after your final payment is due by making additional monthly payments. If the amount is more than your monthly payment, it will be split over a number of months. This means that you'll not pay more than your normal monthly payment each month.

You don't need to ask your bank to make any changes to your direct debit. We'll take care of this for you.

If your payment holiday has come to an end and you can't restart your payments, you can extend your Payment Holiday to up to 6 months. You'll need to extend your Payment Holiday one month at a time. This means that you only take a break from your payments for as long as you need.

A Payment Holiday won't show as missed payments on your credit file but lenders may take it into account when making future lending decisions. You should keep in mind that lenders may use other sources of information when they make a decision to lend to you in the future.

How you will know that the payment holiday is in place

We will defer your payments one month at a time. Each month you will receive a letter confirming your next payment date has been moved by one month. This letter will tell you how much extra you will pay as the result of deferring your payments by taking a payment holiday that month. You will need to add up the amount shown in each of the letters to work out the extra amount that you will pay overall.

Why you pay more for a payment holiday

We'll need to adjust the amount you pay as you'll take longer to pay back the amount you’ve borrowed.

You may have to pay other costs if you extend your Payment Holiday. 

If you keep your vehicle for longer, you'll need to pay for your insurance and road tax for longer. 

If you have a warranty or breakdown cover, it may not cover you for the extended time that you'll have the vehicle. You may also need to pay for an additional MOT or service.

The value of the vehicle will reduce over time. As you take longer to pay back the finance, the vehicle may be worth less than the outstanding balance.

If you have a PCP finance agreement, your maximum permitted mileage will stay the same. If you hand your vehicle back and you have exceeded the permitted mileage, you'll be charged for excess miles.

If you’ve reached the end of your payment holiday and can restart your payments

You'll restart your monthly payments and after you pay the last regular monthly payment, you'll pay the extra amount.

Your monthly payment will be for the same amount as before your payment holiday.

If you've been charged an extra amount for taking a payment holiday, you'll not pay this until after your last payment. If it is more than your monthly payment, it will be split over a number of months. This means that you'll not pay more than your normal monthly payment each month.

The payment date for your monthly payments will likely have changed as a result of taking a payment holiday. You would've received a letter from us telling you the new payment date. You can also check your payment date, just log into your online account and check the ‘My account’ screen.

If you’ve cancelled your Direct Debit, please reinstate it at least 8 working days before your next payment is due. To do this, you can sign in to your online account and select ‘Update bank details’. You’ll then need to enter your sort code and account number.

If it’s too late to reset your Direct Debit for when your payments restart, you can make a payment by debit card using the “Make a payment’ option in your online account.

If you're unsure if you've cancelled your Direct Debit, you can check if it is still active with your bank. You should be able to find this information on your bank’s online banking or mobile banking app. If not, you’ll need to call your bank.

If you need extra support to make your payments

Payment Holiday

A payment holiday means you can pause your usual payments for up to 3 months to help stop you falling behind. After that, you start paying the same amount each month as before your payment holiday.

If you’ve had a payment holiday for 3 months or more and you can’t restart your payments, you may be able to extend your payment holiday to up to 6 months.

Taking a payment holiday won’t directly affect your credit score, as it won’t show that you’ve missed payments during this time. But lenders take a wide range of information into account when making decisions on borrowing, and this includes details you may provide about how you’ve managed your account, such as taking a payment holiday.

Term Extension

If you’re not able to restart your full monthly payments, we may be able to increase the length of your agreement which will reduce how much you pay each month. This is called a Term Extension.

A Term Extension will cost you more in the long term as it will take you longer to pay back the amount borrowed.

If you ask us for a Term Extension we’ll need to do a credit file check and you’ll need to sign an agreement to confirm you’re happy with the changes.

If you’ve already taken a payment holiday before taking a Term Extension, you won’t need to pay any extra amounts added for taking a payment holiday.

Any payment holidays you’ve asked for but haven’t yet been taken will be cancelled. To keep your payment holiday, wait until they have completed before requesting a Term Extension.

As part of the application, you’ll be able to use a Term Extension calculator to work out the best option for you. You can also use the Budgeting Tool to work out how much you can afford to pay each month.

To apply for a Term Extension, you can sign in to your online account and select ‘Manage Payment Holiday’.

If your payment is due within the next 8 days, you should wait until after you have made your next monthly payment to apply for a Term Extension. If you can’t make your next payment, call us on 0333 202 7967 to see how we can help.

If the change to your income is short-term or you think things might change again soon, a long-term option like a term extension, might not be the best option for you right now. We’ve listed other available options below or you can talk to us about what options might be best for you.

If you don’t want to keep your vehicle, you can end your agreement early and hand it back to us. This is called Voluntary Termination and you may still have an amount to pay if you do this.

If you want to keep your vehicle, there are options such as giving you a period of breathing space to sort out your finances or a reduced payment plan. These options will impact your credit file, so make sure you talk to us about what this means for you.

If you've reached the end of your payment holiday and can't restart your payments.

If your income is still impacted by coronavirus and you can't restart your payments, we have options available to help. Use our online tool first to work out what you can afford to pay. You can then call us, on 0333 202 7967 so we can talk it through.

To ensure we can give you the best support when you call us, please get all details of your income and expenditure ready before you call. This may include wage slips, bills and bank statements.

What if you have already missed payments

If you’ve missed payments call us on 0333 202 7967 as soon as you can so we can talk about your options.