Millions of motorists could soon receive money back on their car loans, as the Financial Conduct Authority (FCA) has announced it will restart handling car finance complaints earlier than expected.
The move marks a key step towards the regulator’s upcoming industry-wide car finance compensation scheme, set to cover an estimated 14 million potentially mis-sold car finance agreements between 2007 and 2024.
Bott and Co welcome this progress. We know many drivers have been left in the dark about hidden car finance commission and unfair lending practices and we remain committed to helping consumers get the compensation they deserve.
Why Are So Many Car Finance Deals Under Review?
The FCA’s proposed scheme targets cases where customers were sold a car finance agreement without being clearly told about the commission paid to brokers or car dealers.
For years, some lenders used Discretionary Commission Arrangements (DCAs), a controversial system that allowed dealers to increase your interest rate to boost their own commission. This practice has since been banned, but millions of motorists may have paid unnecessarily high interest as a result.
As many customers were not properly informed, these loans may amount to mis-sold car finance, making them eligible for compensation under the forthcoming FCA redress scheme.
Lenders Push Back, However the FCA Stands Firm
Unsurprisingly, lenders have resisted the scale of the proposed compensation programme. With around 14 million car finance deals potentially affected, the financial impact on the industry could be significant.
Despite this pushback, the FCA has made clear that consumers must come first. The regulator is currently consulting on the final design of the scheme, with a launch expected early next year.
Complaints to Resume Two Months Earlier
To ensure a smoother process, the FCA has confirmed that it will end its temporary pause on handling car loan complaints ahead of schedule. This gives lenders time to get their systems ready and ensures that consumers won’t face unnecessary delays.
The FCA expects the majority of car finance complaints to fall within the scope of the new redress scheme. However, firms will still need to respond to any complaints that fall outside it, meaning motorists can begin progressing their cases sooner.
What This Means If You Took Out Car Finance Between 2007 and 2024
You may be entitled to car finance compensation if:
- Your loan was arranged between January 2007 and January 2024
- You were not told about the dealer or broker’s commission
- Your interest rate may have been inflated because of it
Many consumers could be owed hundreds or even thousands of pounds. With complaints restarting early, now is the ideal time to check if your car loan was mis-sold.
How Bott and Co Can Help You Claim Car Finance Compensation
We specialise in helping motorists challenge unfair lending practices. Our experts can locate your agreements, explain your rights and guide you through every step of making a mis sold car finance claim.
We can help you:
- Understand whether your car finance commission was unfair
- Find out if your agreement is likely to qualify for compensation
- Prepare your complaint so you’re ready when the scheme goes live
- Navigate lender responses and deadlines
If you think your car finance was mis-sold, you’re not alone and you don’t have to fight it alone.
Start Your Car Finance Claim Today
Check whether you could be owed compensation with our instant claim check.
Bott and Co is here to help you get back what you’re rightfully owed.