When I think of “auto-payment relief,” I flashback to 2009 when Hyundai announced its Assurance Program, this program was created to help their customers by allowing them to return their vehicles within a year of their purchase date in the event of a job loss. This plan was a result of the financial crisis due to the recession. Fast forward back to the present and looking around, many people are finding themselves in a similar situation because of the coronavirus pandemic.
The pandemic brought in a whole new level of economic uncertainty. As someone once said to me, “We are all in the same storm, a different boat.” That is because everyone’s situation is a little different. Some may be lucky enough to work in industries where they do have job security; some people are small business owners struggling to keep their livelihood open; others still have jobs, but their hours/pay have been cut; or sadly, some people have found themselves without employment. Heck, there are even some people who currently have a job but are unsure of the future. We are all in different situations due to the same “storm.” With that in mind, many consumers can find themselves in a situation where they want to get a new vehicle but are concerned they might not be able to make the monthly payments in the future.
To bring peace of mind to their consumers, some manufacturers have come up with programs similar to what Hyundai did back in 2009. Because of the pandemic, many banks have released different ways to incentivize consumers to act now and boost car sales. In the last few months, we have seen things such as zero-percent financing, deferred payments for 90/120 days, tons of rebates, etc. Hyundai, for example, introduced a modified version of their assurance program early on in the pandemic. They would make up to 6 payments on behalf of the customer if the vehicle were purchased or leased thru Hyundai Motor Finance in the event of a job loss. If you were a current owner, you could defer payments up to 3 months due to a job loss or medical hardship. New customers had the option for zero-percent financing or deferred payments of 120 days.
Now Ford Motor Co. is launching a similar program. “Under the new Ford Promise program, customers who lease or purchase a vehicle with Ford Credit financing and then lose their job within a year can return the vehicle,” says Ford. They also claim that job loss does not have to be related to the pandemic. Under this program, Ford Credit will appraise the vehicle using NADA average trade-in and reduce the customer’s balance by that amount. They will also waive up to an additional $15,000 if needed. Anything beyond that, including late payments and vehicle damages, will be the responsibility of the customer. Hopefully, this new program set forth by Ford will offset some of the employment uncertainty consumers have when they are searching for a vehicle.
The purpose of all these programs that are made available by the manufacturers are (in my opinion) to one, hopefully, increase sales; two, to help customers in the unfortunate event that they do find themselves without a job; and three, to give a bit of confidence to the customers that these companies understand, are there for them, and are willing to help as well. No matter your situation, I’m sure everyone could use a little bit of help right now.