Mis-Sold Car Finance
Payout Calculator
Millions of UK drivers may have been mis-sold PCP or HP car finance through hidden commission arrangements. Enter your finance details to estimate how much compensation you could be owed — completely free.
Your Finance Details
Enter details from your car finance agreement to estimate your potential payout. Check your original agreement documents for exact figures.
Enter your finance details and click Estimate My Payout to see your estimated compensation range.
Understanding the car finance scandal
A guide to the key terms, claim types and lenders involved in the UK car finance mis-selling scandal.
| Term | What It Means | Relevance to Your Claim | Status |
|---|---|---|---|
| DCA | Discretionary Commission Arrangement — dealers could set interest rates higher to earn more commission | Core basis of most mis-selling claims | Banned Jan 2021 |
| PCP | Personal Contract Purchase — monthly payments plus large optional final balloon payment | Most common finance type in claims | Eligible for claims |
| HP | Hire Purchase — fixed monthly payments until the car is yours | Also eligible if DCA was used | Eligible for claims |
| FCA Review | Financial Conduct Authority investigation into motor finance commission arrangements | Will determine redress scheme structure | Ongoing 2025 |
| Supreme Court Ruling | Oct 2024 ruling found undisclosed commissions unlawful — lenders must repay | Strengthened all affected claims significantly | Confirmed unlawful |
| Redress Scheme | FCA-mandated process requiring lenders to automatically compensate affected customers | May not require you to actively make a claim | Expected 2025 |
| Claims Deadline | Current FOS complaint window extended — check with FCA for final deadline | Act early; timebar rules may apply | Monitor FCA updates |
DCA = Discretionary Commission Arrangement. PCP = Personal Contract Purchase. HP = Hire Purchase. FCA = Financial Conduct Authority. FOS = Financial Ombudsman Service.
| Lender | Est. Liability | Avg Reported Payout | Notes |
|---|---|---|---|
| Lloyds / Black Horse | ~£2.5bn | £1,100–£2,500 | Largest exposure |
| Close Brothers | ~£400m+ | £800–£1,800 | Supreme Court case defendant |
| Santander Consumer | ~£300m+ | £700–£1,600 | Provisioned funds |
| Barclays Partner Finance | ~£600m | £900–£2,000 | — |
| MotoNovo (FirstRand) | ~£200m | £600–£1,400 | — |
| Moneybarn | ~£100m+ | £500–£1,200 | Specialist / subprime lender |
| Manufacturer Finance Arms | Varies | £400–£1,500 | BMW, VW, Ford, etc. assessed separately |
Figures are estimates based on publicly reported provisions and analyst research as of 2024–25. Actual payouts will depend on the FCA’s final redress scheme. Using a claims management company (CMC) typically costs 20–35% of any payout received.
| Date | Event | Impact | Action Needed? |
|---|---|---|---|
| Pre-2021 | DCAs widely used by dealers and lenders across UK | Millions of agreements potentially affected | Check your agreements |
| January 2021 | FCA bans Discretionary Commission Arrangements | Agreements before this date are in scope | — |
| January 2024 | FCA announces formal review into historical motor finance DCAs | Complaint handling paused at lenders and FOS | Lodge complaint to preserve timebar |
| October 2024 | Supreme Court rules undisclosed commissions unlawful | Significantly strengthened all claims | Positive development |
| Mid 2025 | FCA expected to announce redress scheme details | Lenders must contact affected customers or set up claims portal | Monitor your lender |
| TBC 2025–26 | Redress payments begin | Automatic or opt-in payouts for eligible customers | Keep documents safe |
The FCA redress scheme may operate automatically — meaning you may not need a solicitor or CMC to receive compensation. Avoid paying high fees unnecessarily. Always check the FCA and FOS websites for the latest guidance before engaging a claims company.
Why millions of drivers may be owed money
Hidden Commission Deals
For decades, car dealers were paid commission by finance lenders based on the interest rate they charged customers. The higher the rate, the more commission the dealer earned — creating a direct financial incentive to charge you more than necessary.
Discretionary Commission Arrangements
Under DCAs, dealers had discretion to increase your interest rate — sometimes by several percentage points — to earn higher commission. This was never disclosed to customers, who had no idea they were being charged more so the dealer could profit.
FCA Investigation & Ban
The FCA banned DCAs in January 2021 after finding widespread harm. It then launched a formal review in 2024 covering agreements going back to 2007, potentially affecting 40+ million finance agreements and costing lenders an estimated £16–30 billion.
Supreme Court Ruling
In October 2024, the UK Supreme Court ruled that undisclosed commissions were unlawful. Lenders must repay the interest overcharged — not just the commission itself. This ruling dramatically expanded the scale of potential compensation for affected customers.
How Much Could You Get?
Average payouts are estimated at £1,000–£1,600 based on typical loan sizes and commission rates. Customers with larger loans, higher interest rates, or multiple agreements could receive significantly more. The FCA redress scheme may pay automatically without requiring a solicitor.
Frequently asked questions
No — the FCA is expected to set up a redress scheme where eligible customers are contacted directly by their lender or can submit a simple online claim. You do not need to use a claims management company (CMC) or solicitor, and doing so means paying 20–35% of your payout in fees. Always check the FCA website and your lender’s own claims portal before engaging a third party.
Most PCP and HP car finance agreements taken out between April 2007 and January 2021 are potentially in scope, provided a discretionary commission arrangement (DCA) was in place. Agreements where the interest rate was fixed (not at the dealer’s discretion) may have a weaker claim. The FCA review covers agreements at dealerships — direct bank loans for car purchases are generally not included.
Based on publicly reported data and analyst estimates, the average payout is expected to be in the range of £1,000–£1,600 per agreement. Some customers with larger loans, higher interest rates, or multiple agreements could receive significantly more. Exact amounts will depend on the FCA’s final redress framework, which is expected to be announced in 2025.
The Supreme Court ruled in October 2024 that it was unlawful for lenders to pay dealers secret commissions without customers’ fully informed consent. Crucially, lenders may not only have to repay the commission earned, but also the additional interest customers were charged as a result. This ruling significantly increased both the number of eligible claimants and the average payout expected.
Write to your lender and ask for a copy of your original finance agreement. Check whether a commission was paid to the dealer — lenders are now required to disclose this. You can also submit a Subject Access Request (SAR) under GDPR, which is free and must be responded to within 30 days. Alternatively, you can submit a complaint to the Financial Ombudsman Service (FOS) if your lender does not respond adequately.
The FCA has paused the standard complaint timebar while it conducts its review, meaning the clock is not running on most claims at present. However, once the FCA announces its redress scheme, deadlines will apply. It is strongly recommended to lodge a written complaint with your lender now to preserve your position, even if they are not required to respond until the FCA process is complete. Check FCA.org.uk for the latest guidance.