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FCA Car Finance Mis-Selling: How to Claim Your Payout
Millions of UK motor finance agreements may qualify for commission compensation, but no payout is guaranteed. The FCA scheme is partly suspended while legal challenges are heard. You can still complain directly to your lender for free and protect your position.
The current FCA position in August 2026
The FCA established a motor finance compensation scheme in March 2026. It covers certain unfair commission arrangements in hire purchase, Personal Contract Purchase and other regulated motor finance.
Four parties challenged the scheme. The Upper Tribunal then suspended parts of it. The hearing is expected in December 2026 or February 2027. Until the legal process ends, lenders do not have to calculate or pay compensation under the suspended rules.
Who may qualify for compensation?
You may be within the scheme if all the following points apply:
- You used finance to buy a car, motorbike, van or campervan between 6 April 2007 and 1 November 2024.
- A dealer or broker arranged the finance with a lender.
- Important information about commission or lender choice was not properly disclosed.
- The agreement included one of the unfair features covered by the scheme.
The finance can be settled and the vehicle can be sold. You can also complain about more than one agreement, but each agreement is assessed separately.
The three commission arrangements that matter
Commission arrangements covered by the FCA scheme
| Arrangement | What it means | Why it may be unfair |
|---|---|---|
| Discretionary commission | The broker could adjust your interest rate to earn more commission. | The broker could benefit when your borrowing became more expensive. |
| High commission | Commission met the FCA tests for a high share of both the loan and total credit cost. | The size of the payment may have affected the recommendation. |
| Contractual tie | The broker used one lender or gave one lender first refusal. | You may not have known that the lender choice was restricted. |
Not every commission payment creates compensation. The FCA scheme includes exclusions, including some low commission amounts, interest free agreements and cases where the lender can show the arrangement was fair.
How to make a car finance complaint for free
- List your agreements. Note the lender, registration, approximate start date and the dealer that arranged each agreement.
- Find the lender. Use the FCA car finance claims page to find lender contact details and its complaint form or template.
- Ask about commission. State that you are complaining about undisclosed motor finance commission and ask the lender to identify any relevant arrangement.
- Keep evidence. Save the submitted form, email, postal receipt and complaint reference.
- Wait for the formal decision. Timings are affected by the legal challenge. The lender should explain how the current pause affects your complaint.
What information do you need?
You do not need the original car or every page of the agreement before complaining. Give the lender enough information to find the account:
- Your full name and the address used when you took the finance.
- The vehicle registration and approximate agreement dates.
- The lender and dealer names, if known.
- An agreement or account number, if you still have it.
Bank statements, old emails and credit reports can help identify a forgotten lender. Do not send original paperwork.
Do you need a claims management company?
No. The lender applies the same FCA rules whether you complain yourself or use a representative. The FCA warns that some claims companies and law firms may charge more than 30% of compensation. Using several firms can also create disputes about fees and representation.
If you already signed with a representative, read its cancellation and fee terms before submitting another complaint.
How much could the payout be, and when?
The FCA previously estimated an average payment of about £830 for an eligible agreement. That is an estimate across the scheme, not a personal forecast. An individual result can be lower, higher or zero. The legal challenge may also change the scheme.
If the scheme is upheld and not appealed, the FCA expects payments to begin in 2027. Your lender must eventually explain whether an agreement qualifies and how any compensation was calculated. Follow updates on the FCA website rather than relying on messages from claims firms.
Sources
- Car finance claimsFinancial Conduct Authority
- Motor finance scheme partially suspendedFinancial Conduct Authority
- Motor finance consumer redress schemeFinancial Conduct Authority
FAQ
Who may qualify for car finance commission compensation?
You may qualify if you used finance for a car, motorbike, van or campervan between 6 April 2007 and 1 November 2024 and were not properly told about a discretionary commission arrangement, high commission or a relevant contractual tie between the broker and lender.
Can I claim if the car finance has been paid off?
Yes. The agreement does not need to be active and you do not need to own the vehicle now. Eligibility depends on the finance agreement and commission disclosure, not current ownership.
Do I need a claims company or solicitor?
No. The FCA says you can complain directly to the lender for free. A claims management company or law firm may deduct a large fee from any compensation and cannot improve the rules used to assess your agreement.
When will car finance compensation be paid?
No firm payment date is available. Parts of the FCA scheme are suspended during legal challenges. The FCA says lenders do not currently need to calculate or pay compensation, and payments may begin in 2027 if the scheme is upheld and not appealed.