If your loan is any of the types listed below, we won’t charge any additional interest during your payment holiday or reduced payment plan.
- Interest free
- Buy now, pay later
- Motor (car) finance
- Caravan finance
If you’re not sure what type of loan you have, you can find out by checking your original agreement. If you’ve lost your original agreement, you can ask us for a copy using our web form.
How will extending my payment holiday affect my motor finance?
At the end of your Motor Personal Contract Purchase (PCP) finance agreement, you’ll usually have the option of making one final balloon payment if you’d like to keep the car. You agree this final payment amount when you sign your agreement, and it’s based on what the car’s Guaranteed Minimum Future Value (GMFV) will be at the end of your payment period.
During a three-or six-month payment holiday, your car’s value might depreciate and fall below the GMFV, but your final balloon payment will stay the same.
If you’d prefer to return the car back to us at the end of your finance agreement, we’ll honour the original GMFV and settle your finance without taking into account any potential changes in value.
How will it affect my motor finance annual mileage allowance?
Your annual mileage allowance will have increased by 25% during your first payment holiday. Extending your payment holiday for another three months will increase your annual mileage allowance by a further 25%.
For example, if your original annual mileage limit was 10,000 miles, this will have increased by 25% to 12,500 miles during your first payment holiday. When you extend your payment holiday, your annual mileage limit will increase by another 25%. This would mean that your annual mileage limit after both payment holidays would be 15,000 miles.
How will extending my payment holiday affect my Buy Now Pay Later finance?
If you’d like to extend your Buy Now Pay Later period by another three months, you can apply for a second payment holiday.
We won’t charge you any extra interest, and you can still make payments at any time to lower your balance.
This would give you more time to pay off your finance in full. When your Buy Now Pay Later period ends (including any payment holidays), we’ll start charging interest on any remaining balance.