Bad credit car loan shoppers have just over 3 weeks in which to take advantage of the Hyundai Assurance vehicle return program.
New cars that qualify
At Auto Net Financial, we specialize in helping consumers with bad credit reestablish their auto credit and raise their FICO scores with a bad credit auto loan through one of our participating dealers. Due to financial considerations, a majority of the vehicles purchased with one of these loans are used cars.
There are, however, a number of new cars that we feel also qualify for many of these bad credit car loans. Among the manufacturers who offer these types of cars would be Korean manufacturer Hyundai. Many of the models from Hyundai qualify for inclusion because of two important factors: they are affordable (aside from the pricier Genesis and SUVs), and they all come with a long and comprehensive new car warranty.
As if this weren’t enough, Hyundais also come with a unique “assurance program” that protects consumers in case of a job loss might cause them to be unable to afford their new car – an event that could be especially devastating to bad credit consumers who are financing their cars with a bad credit car loan in order to improve their credit scores.
But the Hyundai Assurance program is set to expire at the end of the year, so bad credit car customers need to take advantage of it while they can.
The Hyundai Assurance program
Here’s how it works: If you finance or lease a new Hyundai vehicle and experience one of 6 covered events, including job loss, within 12 months of purchasing the car, you have the option to return your Hyundai and walk away from up to $7,500 of negative equity with no impact on your credit score. This coverage comes at no charge and buyers are qualified regardless of their age, health or employment history.
Qualifying events
The 12-month policy covers the following qualifying events:
• Involuntary Unemployment
• Physical Disability
• Loss of Driver’s License due to Medical Impairment
• International Employment Transfer
• Self-Employed Personal Bankruptcy
• Accidental Death
Covered employment issues include termination (not a resignation), job loss due to a move by the employer as well as co-signed loans if the primary borrower suffers a job loss. International employment transfers are also covered and a transfer to any country other than the United States is considered “international.”
Disability events include work loss due to physical disability, while the medical impairment example used is loss of vision due to pre-existing diabetes.
Credit rating impact
According to Hyundai, if customers follow the correct procedures outlined in the program (call or email the assurance administrator, supply the necessary documents, have your vehicle appraised at a Hyundai dealer), the return of a vehicle resulting from a paid (and approved) benefit is considered an early pay-out of the loan or lease and is not considered a voluntary repossession and, therefore, will not impact the borrower’s credit rating “in any way”.
Program limitations
At Auto Net Financial, as far as we can tell, there are only two big limitations to the program – time frame and negative equity. Unfortunately, borrowers are only covered during the first year of the loan. Once that time has expired, consumers are in the same situation they would’ve been in without the coverage.
The second issue, negative equity, needs to be examined from the perspective of your own personal situation. If you are rolling in negative equity from a previous car loan, or if the vehicle you are buying is one of the more expensive models, $7,500 may not be enough to cover the negative equity during the first 12 months of the loan. In this case, you would have to come up with additional funds of your own in order to cover the entire amount and qualify for the buy-out.
As we see it
Here at Auto Net Financial, we think that Hyundai’s assurance plan is probably one of the most innovative programs we’ve seen in a long time. With the program set to expire on December 31st, bad credit car loan buyers have just over 3 weeks in which to take advantage of it.
For more information on bad credit car loans and the bad credit auto loan process, please visit our web site at www.autonetfinancial.com.
