Personal bankruptcy has made Hyundai’s list of life-changing events, CNNMoney.com reports.As defined by the automaker, life-changing events include involuntary job loss, getting transferred overseas, and accidental death, along with personal bankruptcy for the self-employed.
Why is Hyundai’s definition important? Through a partner named Walkaway USA, Hyundai Motor America is offering car buyers who cannot make car payments because of a life-changing event the chance to return the car and to be excused from all or most of their remaining loan obligation.
In my earlier bankruptcy blog, “Car Repos – In And Out Of The Driver’s Seat”, I explained how filing bankruptcy can avert or even reverse repossession of a car. If car payments were missed, the debtor may still have the option of buying back the car. The advantage of the Hyundai offer, is that no record of a default would appear on the debtor’s credit record. The program is designed to help sell cars to Americans worried about job security.
The drawback of Hyundai’s offer, of course, is that people who’ve lost a job need a car to find and commute to a new job. Hyundai counters that concern by explaining that a laid-off worker could choose to trade in the new Hyundai for a used car. The automaker also stresses that bankruptcy qualifies as a life-changing event only for the self-employed.
As a bankruptcy lawyer in Indiana for so many years, I understand the reasoning behind that rule. As I explained in “It’s The Business, Stupid!”, the small business owner’s personal and business finances tend to be closely intertwined. The Hyundai offer is meant for situations where the core reasons for the bankruptcy have to do with outside forces beyond the car buyer’s control.
As CNNMoney puts it, “the program should drive some car shoppers to at least consider a Hyundai and it will make them feel cared for.”