There are times that a borrower might experience difficulty – a life event, a change of jobs, unforeseen medical expenses, etc. – that would cause them to fall behind in their payments, even though this never was their intent. Once their situation has stabilized, they may find that they can make the regular monthly payments but are unable to bring their account totally current. In these instances, we offer them the Payment Improved Courtesy for Loans (PICL or “pickle”) program to bring the account back to current status.
The PICL program allows qualified borrowers who are two consecutive months late in making a payment to continue making payments without paying late fees and avoid detrimental reporting to the credit bureau. It brings the account back to current status without changing the term, rate, or monthly payment amount on the loan. Once the PICL Program is applied, it is the obligation of the customer to keep the account in current status going forward. If, after entering the Program, the account becomes 60-days delinquent again, the Program is discontinued, and the previous account delinquency will be reversed and added to the new delinquency to determine the account delinquency status. For example, if the account is 90-days past due and the PICL Program is applied to bring the account current and subsequently the customer again becomes delinquent 60-days past due, the PICL will be removed and the account will be considered 150 days delinquent.
During the COVID-19 pandemic, we saw that many borrowers needed greater flexibility as they adjust to the present economic hardship and employment opportunities. Thus we expanded the flexibility of the PICL program to extend the benefits to more borrowers. Under COVID-PICL, accounts that become past due 60 days will not reverse, providing the needed flexibility. Many of those who utilized COVID-PICL were able to make financial adjustments and shortly returned to current payment status.