Mis-Sold Car Finance Claims: Where Things Stand
Bott and Co understand many of our clients are eager for updates regarding mis-sold car finance claims.
Here’s everything you need to know about the timeline, the process, and what we’re doing for you.
The FCA’s car finance compensation scheme is final but partly on hold. On 2 July 2026 the Upper Tribunal suspended parts of it while it hears four legal challenges. Lenders do not have to work out or pay compensation until that process ends.
The main hearing will take place on either 14–18 December 2026 or 16–26 February 2027. If the scheme is upheld and not appealed, the FCA expects payments to begin in 2027.
What is still happening while the FCS scheme is on-hold
The scheme is paused, not stopped. Lenders must still:
• Identify complaints and agreements that fall under the scheme.
• Gather commission data, including from brokers and dealers.
• Tell people who complained but are not owed compensation.
• Keep complainants updated on the delay.
What you should do now
If you have not complained yet, you still can. Bott and Co can check your agreements between 6 April 2007 and 1 November 2024.
Mis-sold Car Finance Timeline and Key Dates
| Date | Significant Development |
|---|---|
| 5th – 6th October | Upper Tribunal confirms it will hear the legal challenges to the FCA’s motor finance scheme on 14 to 18 December 2026 or 16 to 26 February 2027 |
| 17th September | Communications from your lender – What to do next. |
| 27th August | FCA confirm redress scheme is temporarily suspended. |
| 29th June | FCA confirmed some lenders want to begin settling motor finance complaints. |
| 8th May | FCA respond to Redress Scheme Challenges |
| 29th April | FCA redress scheme faces Legal Challenges |
| 30th March | The FCA publish final rules for the redress scheme |
Has the car finance compensation scheme been cancelled?
No. Parts of it are suspended while the Upper Tribunal hears legal challenges. The FCA says it will defend the scheme in full.
What happens if the challenges succeed?
The FCA would decide its next step. It has said it may tell lenders to handle complaints individually, with an 8-week response deadline and the option to go to the Financial Ombudsman.
Is there still complaints pause?
No. The pause ended on 31 May 2026.
Will I still get compensation if I have already complained?
If you are owed money under the scheme, yes. People who complained before the scheme deadlines will be dealt with first once payments can start.
What is Bott and Co doing with Motor Finance claims?
Your claim is registered and being actively managed by our specialist motor finance team. While the FCA’s pause means lenders are not yet required to issue final responses, we have not been idle:
- Preparing your file: All documentation and evidence is being reviewed and organised so your claim can be progressed without delay when the scheme launches.
- Monitoring developments: Our legal team tracks every FCA publication and consultation response to ensure we’re fully prepared.
- Ready to act: Once the FCA publishes final rules, we’ll be in a position to progress your claim swiftly.
You don’t need to do anything right now. Your claim is lodged and we’re managing it. There is no advantage to instructing another firm, it would not speed up the process and could result in unnecessary costs.
Why should I stay with Bott and Co?
If you’re considering submitting a new motor finance claim or thinking about using another firm, read why choose Bott & Co for mis-sold motor finance claims to understand our approach and support.
What is the FCA Motor Finance redress scheme?
It is an industry-wide compensation scheme for people who were not told about important commission arrangements when they took out car finance. The FCA confirmed the final rules on 30 March 2026 in policy statement PS26/3.
The FCA estimates 12.1 million agreements are eligible, with an average payout of around £830 per agreement. Parts of it are currently suspended while the Upper Tribunal hears legal challenges
How will the FCA redress compensation scheme work?
Who is covered?
The scheme covers regulated motor finance agreements (PCP, HP, conditional sale) taken out between 6th April 2007 and 1st November 2024 where commission was paid by the lender to the broker and was not adequately disclosed.
What are the types of Motor Finance unfairness?
The FCA has identified three key situations: discretionary commission arrangements (DCAs) where interest rates could be varied without disclosure; excessive commission (35%+ of total credit cost and 10%+ of the amount borrowed); and undisclosed contractual ties giving lenders exclusivity with a broker.
How much compensation for Mis-sold Motor Finance?
The FCA estimates an average of approximately £830 per agreement, though individual amounts vary. Compensatory interest will also apply.
How is Mis-sold Motor finance compensation delivered?
Lenders deliver the scheme directly. Consumers who have already complained (including through solicitors like Bott and Co will be automatically included unless they opt out to pursue a court claim instead.
Mis-sold Car Finance Claims FAQs
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No. Your motor finance complaint has been submitted and is being managed by Bott and Co. Once the pause lifts and the scheme is operational, we will progress your claim on your behalf.
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No, your motor finance claim is already lodged and changing representative would not speed things up and in fact will likely slow things down and increase the costs you may have to pay.
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We will contact you once the FCA publishes its final rules or sooner if there is a significant development.
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Each eligible agreement is assessed separately. If you had multiple deals within the scheme’s scope, you may be entitled to compensation for each one.
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Please forward any communication from your lender to us so we can review and advise. Do not accept any offer without speaking to us first.
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Email motorfinanceclaims@bottonline.co.uk who aim to respond within 1 working day
In your email, include:
Your full name
Your claim reference number (if you have it)
Please also be aware there is an FCA “complaints pause” in place until 31 May 2026, which means lenders are not yet giving final responses on motor finance complaints. This can make everything feel very slow, even when work is happening in the background. -
Please email our Motor Finance department and they will be able to assist you.
Motorfinanceclaims@bottonline.co.uk
In your email, include:
Your full name
Your claim reference number (if you have it)
Please also be aware there is an FCA “complaints pause” in place until 31 May 2026, which means lenders are not yet giving final responses on motor finance complaints. This can make everything feel very slow, even when work is happening in the background.