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Mis-sold PCP Car Finance Claims

Author: Samuel Beckingham
Updated: Aug 04, 2022
3 minutes read

If you were mis-sold PCP car finance, you have a right to make car finance claims and recoup some or all of your losses.

The UK Financial Conduct Authority (FCA) recently determined that people like you unknowingly paid commission on their car finance agreements. Up to 95% of agreements were mis-sold in this way.

Your car salesperson might have even sold you the wrong product to increase their commission. If you did not know that you were paying commission when you purchased car finance, you could be eligible to make mis-sold car finance claims. In addition, you might have paid too much interest on your car financing - another valid reason people file car finance claims.

You might be eligible to make multiple car finance claims if you purchased more than one car during this time. You can make car finance claims for all vehicles you bought between 2007 and October 2019.

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Who Can File Car Finance Claims?

The UK has laws in place to protect consumers. For example, if you purchase a car or other vehicle using finance, your car finance broker and lender must tell you about everything the deal includes. This includes alerting you to commissions so you can make an informed decision.

However, not all car salespeople follow this guidance. In the interest of earning hefty commissions, they don’t disclose all of the information, even though this opens them up to car finance claims.

If your lender didn’t tell you about their commission structure, you could be eligible to make a mis-sold PCP claim. As a result, you could be entitled to thousands of pounds. You can also make excessive commissions claims for other forms of finance.

Are you owed money from car finance claims? If you were approved for PCP or HP between 2007 and October 2019, you could be eligible to make car finance claims.

What Are Mis-Sold Car Finance Claims?

Simply put, when you take out finance for a car in the UK, your lender has to be clear and upfront about all charges. They sometimes charge clients extra fees or offer them high-interest rates to boost their commissions and profits. They give negligent advice and even outright lie.

However, they must pay car finance claims if they get caught. That’s because hiding any details or charging extra to cover their commission opens them up to car finance claims.

If you think you might have been overcharged or misled, you could be eligible for a mis-sold PCP claim.

Common Mis-sold Car Finance Claims

Here are some of the most common PCP car finance claims. Do any of these apply to you?

High-Pressure Sales Methods

No one likes facing high-pressure sales tactics, which can persuade us to make bad decisions. That’s why the FCA recognises that high-pressure sales are a real problem.

If you feel like a broker or car salesperson pressured you to sign the dotted line on a finance agreement that wasn’t in your best interests, you could be eligible to make a mis-sold PCP claim. They should have given you time and the correct information to help you choose the best deal for your needs.

Hidden Commission Charges

You might be eligible to make one or more car finance claims if your financial broker or car dealership hid commission charges from you. According to the FCA, countless British buyers were unaware that they were paying inflated prices to cover commissions.

In some cases, car salespeople were given incentives to bring you to a specific bank or lender. If this is the case, the lender has a legal obligation to disclose commission fees to you. In fact, they must tell you about all fees. If not, you’re eligible to make one or more car finance claims.

Falsely Inflated Prices and Huge Commissions

Your lender could have inflated your car finance agreement or PCP deal to line your broker’s pockets. Unfortunately, this has happened to countless consumers. If this applies to you, you should consider car finance claims.

Your Lender Didn’t Conduct Affordability Checks

Lenders, including banks, have an obligation to conduct suitable affordability checks to ensure clients only enter into loan agreements that are appropriate for their financial situation. However, the FCA has found that many lenders did not conduct affordability checks, leaving borrowers in a challenging financial situation. Many people had to default on their loans.

If this was the case for you, you could join thousands of people who have made successful car finance claims.

Emissions Scandal Claims

Other common car finance claims include emissions scandal car finance claims. You might be eligible for this type of claim if you purchased a car based on its low diesel emissions, only to find out this information had been tampered with.

If you entered a loan agreement for a vehicle based on its low emissions, you might be eligible to make a mis-sold PCP claim.

Am I Eligible for Mis-sold Car Finance Claims?

To find out if you are eligible to make one of these car finance claims, have a look at the criteria below.

People can make car finance claims in the UK if they:

  • Entered a car finance agreement or PCP agreement to purchase their car
  • They bought the car between January 2007 and October 2019
  • They received misleading or false information
  • They were not told about commissions their lender paid to their car salesperson
  • They were pressured into taking an unsuitable loan

Remember, if you purchased more than one car during this time, you might be eligible to make multiple car finance claims.

How Do I Know If I Paid Hidden Commission?

You might be wondering if you are eligible for any car finance claims. One of the main ways is to determine if you paid hidden commissions. But what is hidden commission?

Hidden commission is when agents, financial brokers, and other lenders sell you a finance agreement that includes inflated interest rates. The money they make from this high interest is then used to pay a car salesperson’s commission.

In some cases, the car salesperson is the one brokering the finance agreement. As a result, they might jack up the interest and receive a pay-out or higher commissions.

No matter what, your finance provider is responsible for telling you about all fees and costs involved in the agreement. If they keep this information from you, you might be eligible for car finance claims.

It’s also important to note that a blanket statement, such as “commission fees are included in this deal,” is insufficient. Instead, the contract must detail the exact amount of commission, who is receiving it, and why.

Your car dealership has a legal obligation to tell you how much commission they include in every transaction. Therefore, you should always read your contract carefully and look for this information. If this information is not there, you may be able to make one or more car finance claims.

No matter what, all financial brokers, including car dealerships, must act in the best interest of their clients. They must not be loyal to a specific lender and should instead find the most appropriate deal for their clients. Finally, they must never enter a conflict of interest by getting you to commit to higher interest in exchange for a pay-out.

If they didn’t abide by these principles, you’re likely eligible for compensation.

How Long Do Car Finance Claims Take to Process?

All car finance claims vary on a case-by-case basis. Sometimes, the car dealership or finance broker might accept responsibility immediately. If that’s the case, you’ll probably get your compensation within weeks or months. However, if they dispute their liability, it will take longer. Some car finance claims even take up to 18 months.

That’s where we can help. Money Back Helpdesk can help you get the compensation you deserve – get in touch today.

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