HAVE you heard about the car finance scandal?
For nearly 20 years, drivers with PCP and HP agreements were being charged higher interest rates, potentially costing them thousands of pounds.
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The missold car finance scandal could cause one of the largest compensation payouts in UK banking history.
An estimated 31.7 million drivers could be eligible to claim a refund.
Could you?
Learn why the car finance mis-selling scandal is serious and why you need to submit your claim to secure a potential payout.
What is the car finance scandal?
In 2021, the Financial Conduct Authority (FCA) discovered that car dealers were earning extra commission on PCP and HP finance agreements by setting higher interest rates.
The bottom line is that they earned more cash if loans were more expensive.
It turns out that the practice, known as Discretionary Commission Arrangements (DCAs), had been ongoing since 2007.
Fast forward to today, and any PCP or HP agreement signed between 2007 and the end of January 2021 could have been mis-sold.
During this period, an estimated 31.7 million PCP and HP finance deals were agreed. That’s about 99% of total car finance agreements.
All of these drivers could be eligible for mis-sold finance compensation, which is why banks and lenders have set aside billions of pounds to deal with claims.
Who is eligible for a refund?
Potentially anyone who bought a car, motorbike, or van with a PCP or HP finance agreement between 2007 and January 28, 2021, when the practice was banned, could be eligible for a payout.
You can even make a claim if you have previously been denied compensation.
Check if you could claim for mis-sold car finance below
How much could drivers receive?
The car finance mis-selling scandal is a serious problem for banks and lenders.
Drivers could be eligible for up to £4,000* for each PCP or HP agreement they took out, say My Claim Group.
Data they have gathered shows that the average person could make two claims, with compensation of roughly £2,000 per claim**.
The £2,000** figure reflects the £1,100 overcharge for every £10,000 financed (estimated by the FCA) plus 8% simple interest.
Had more than two agreements? There are no limits on the number of claims that you can make as long as you’re eligible.
How to check your eligibility for a car finance scandal claim
Not all car finance agreements were mis-sold.
To find out if you’re eligible, you’ll need to find details of your HP and PCP car finance agreements and communicate directly with the lender.
Don’t worry if you can’t remember who arranged your loan agreement or provided the finance, there’s another way to claim compensation.
Claims management firms like My Claim Group can manage the whole process for you, including identifying eligible finance agreements, contacting your lender, and passing you onto a solicitor firm that could secure your compensation.
The solicitor firm will take a fee from the settlement to cover the cost of the service of up to 36%, including VAT*.
How does it work? Let’s walk you through each step below.
Check if you could claim for mis-sold car finance below
My Claim Group: Steps to make your claim
Claiming car finance mis-selling compensation is simple with My Claim Group.
To register, you’ll need to provide some personal information and details of your current and previous addresses.
Once you’ve signed up, My Claim Group will be able to access your credit history and identify any car finance agreements that may have been mis-sold and confirm your eligibility for.
If you’ve got more than one agreement, they’ll be able to help you find them for the law firm to submit multiple claims on your behalf.
With my Claim Groups trusted solicitor partners, you’ll receive regular notifications about the status of your claim and the potential likelihood of a payout.
It’s a simple, quick and easy way to secure compensation for car finance mis-selling.
Car finance mis-selling FAQs
Get some answers to common car finance mis-selling questions.
What happens after you submit your claim?
Lenders are currently dealing with thousands – and potentially millions – of claims, so you’ll need to be patient.
Due to the high volume of claims, the FCA has given lenders until 4 December 2025 to begin communicating with claimants.
If you’ve claimed with My Claim Group, you’ll receive regular notifications about the status of your claim and the potential likelihood of a payout.
How long does the process take from application to payout?
We can’t tell you exactly how long it will be until you receive a payout (see above).
What’s important is that you get a claim in today. The sooner you lodge your claim, the sooner you could receive a payout.
Tips for protecting yourself in future
If you’ve been caught out by the car finance mis-selling scandal, it wasn’t your fault.
While all current PCP and HP agreements will be sold legally, here are some tips to ensure you get the best deal on any finance agreement.
- Take some time to learn about the different types of finance agreements (car loans, PCP, HP, etc.), including their benefits and drawbacks
- Understand how to compare the costs (including APR) of any finance agreement
- Always ask about any add-ons or additional fees you’re being charged
- Trust your instincts and be prepared to walk away if you feel you’re being pressured to sign
- Check the small print for any added extras that could increase costs
- Ask for a copy of the credit agreement so you can see what you’re signing
- Finance agreements have a 14-day cooling off period, so don’t worry if you get second thoughts, there’s time to change
Check if you could claim for mis-sold car finance below
My Claim Group is a trading name of the Claims Protection Agency Ltd, authorised and regulated by the Financial Conduct Authority (FCA No. 836470). *My Claim Group will undertake a free check at no cost to you on your behalf to assess if you may have a vehicle finance claim. *** If you proceed, our panel solicitors work on a no win, no fee basis (subject to exclusions, for full details click on: https://myclaimgroup.co.uk/no-win-no-fee). Solicitor fees are up to 36% inc VAT. We receive a fee after a successful payout or a referral fee from your solicitor and this does not affect the compensation you will receive. You do not need to use a claims management company to make a claim; you can do this yourself for free by contacting the car dealership or finance provider and if that is not successful you can complain to the Financial Ombudsman Service. **See link for the FCA reference, solicitor fee tables & average valuations: https://myclaimgroup.co.uk/dca
