Am I owed money for mis-sold car finance?
Millions of UK car finance deals had a hidden problem. The dealer or broker who arranged your loan often earned commission from the lender, and in many cases that commission was never properly disclosed to you. Some of those deals also let the broker bump up your interest rate to earn more for themselves. After the Supreme Court ruled on this in August 2025, the FCA confirmed a formal redress scheme in March 2026. If your agreement qualifies, you could be owed a refund of the extra you paid plus interest. You do not need a claims firm to get it.
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The FCA's Motor Finance Consumer Redress Scheme (Policy Statement PS26/3, March 2026) covers car finance agreements taken out between 6 April 2007 and 1 November 2024. It captures both discretionary commission arrangements (where the broker could set your interest rate to earn more) and other cases where commission was not properly disclosed. The FCA estimates around 7.5 billion pounds will be paid out, with an average of roughly 830 pounds per qualifying agreement, though individual amounts vary. Lenders are required to contact customers they believe are owed money, but you do not have to wait. You have until 31 August 2027 to complain to your lender if you have not been contacted. If you are unhappy with how the rules were applied, you can ask the Financial Ombudsman Service to review your case for free.
Step by step
- 1Work out which agreement you had. Dig out any paperwork for car finance (PCP, hire purchase or a conditional sale) taken out between 6 April 2007 and 1 November 2024. If you have lost the paperwork, you can still complain. Your lender holds the records and can look you up by name, address and rough dates.
- 2Write to the lender named on your agreement, not the dealer. State that you are complaining about undisclosed commission on your motor finance and that you want it assessed under the FCA's redress scheme. Give your name, address at the time, the car details and roughly when you took the finance out.
- 3Wait for their response. They must acknowledge your complaint and assess it under the scheme. If your agreement qualifies, they will calculate and offer your redress. Keep a copy of everything you send and receive.
- 4If you disagree with the outcome or they do not respond, refer it to the Financial Ombudsman Service for free. You can ask them to check whether the scheme rules were followed correctly. If you have not been contacted by your lender, the deadline to complain is 31 August 2027, so do not leave it too late.
What they'll say, and your comeback
“The commission was disclosed in your paperwork, so there is nothing owed.”
Comeback, A brief mention buried in small print is often not enough. The scheme looks at whether the disclosure was clear and fair. Ask them to confirm in writing exactly how and where it was disclosed, then refer it to the Ombudsman if you are not satisfied.
“Your agreement is too old to look at.”
Comeback, The scheme deliberately covers agreements going back to 6 April 2007. Age alone does not rule you out. Ask them to assess it against the redress scheme dates rather than the usual six-year complaint window.
“You need to use a claims management company to make this claim.”
Comeback, You do not. Complaining directly to your lender and, if needed, the Financial Ombudsman is free and you keep 100 percent of any refund. A claims firm would take a cut for work you can do yourself in a couple of letters.
FAQ
Do I need to do anything if my lender is supposed to contact me?
Lenders will contact people they believe are owed money, but there is no guarantee they will reach everyone or that their assessment captures every case. Complaining yourself puts you in the queue sooner and gives you a clear record. People who complain before the lender's implementation deadline are generally compensated earlier.
What counts as a discretionary commission arrangement?
It is a deal where the broker or dealer was allowed to set or adjust your interest rate, earning more commission the higher the rate they charged you. These were banned by the FCA on 28 January 2021, but plenty of pre-ban agreements are covered by the redress scheme.
Ready to get your money back?
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A self-serve tool, not a law firm. General information, not legal advice.