For motor finance companies, and specifically the collections teams within them, this has been an extraordinarily busy time.  Customers initially took their lead from the early announcements about mortgage repayment holidays and started to call their motor finance providers to question the availability of forbearance options.

The FCA has now issued guidance on temporary COVID-19 forbearance measures for motor finance customers.  This guidance is in force from TODAY 27th April 2020.  

In my view there are a couple of common misunderstandings.  Firstly it applies to customers suffering temporary hardship as a result of COVID-19 and it does not apply retrospectively.  If customers were in arrears before COVID hit,  lenders should follow their usual compliant forbearance processes.  Secondly, this guidance does not implement a blanket ban on repossessions during lock down.  Lenders will undoubtedly come across customers that are not using their vehicles and request recovery either pursuant to a VT request or a "consensual" repossession which can be done while maintaining the government's social distancing guidance.

Where the customer has paid over a third of the total amount payable, a court order may be needed.  In some cases we are seeing courts simply grant Return of Goods Orders without a hearing and so please do not stockpile old arrears cases until after the crisis.  I do predict we will see issues with court delays in a few months and a court system that will quickly become overwhelmed if lenders do adopt this stockpiling approach.  

So the answer to the question - yes you can and should repossess if :-

1.your customer was in arrears before the crisis, (and so by consequence not suffering temporary financial hardship as a result of COVID ); and

2. your customer consents to the repossession so that is can be done safely and complying with social distancing guidance; and/or

3. your customer has exercised a right to Voluntarily Terminate or Voluntarily Surrender (post Termination) and/or

4. Your vehicle has been seized by the police and is in a pound or at risk for some reason or due to fraud.