Many consumers have been affected, leading to potential claims for car loan compensation UK.
In recent years, the UK car finance industry has faced significant scrutiny due to issues like undisclosed commissions and unclear finance terms. This article explores the key aspects of this scandal, helping you understand if you are eligible and how to proceed with the help of Your Lawyers.
The core of the problem lies in how car finance deals were structured. Some dealers received commissions from lenders for arranging finance, but these were not always disclosed to customers, nor arranged in their best interests. This lack of transparency could lead to higher interest rates and unfair deals. Additionally, unclear finance terms in agreements meant that borrowers might not have fully understood the costs involved.
From the recent developments, the UK Supreme Court ruled on August 1, 2025, that failure to disclose commissions does not automatically constitute a breach of fiduciary duty or bribery. However, high or undisclosed commissions can still indicate an unfair relationship, potentially opening the door for compensation. The Financial Conduct Authority (FCA) has noted that such practices might entitle affected individuals to redress, especially if the agreement was deemed unfair.
This scandal potentially affects millions who financed vehicles between 2007 and 2021, with personal contract purchase (PCP) and hire-purchase (HP) deals being the most common. If you suspect your car loan involved hidden fees or vague terms, it is worth investigating further.
Determining if you qualify for car loan compensation UK starts with checking your finance agreement. Key indicators can include whether the dealer acted as a broker and received a commission without your informed consent. Even after the Supreme Court’s decision overturning broader liability for non-disclosure, claims can proceed if the terms were unclear or the commission led to an unfair outcome.
Eligibility typically applies to agreements before January 28, 2021, when new rules mandated disclosure. If your deal involved discretionary commission arrangements (DCA), where dealers could inflate interest for higher payouts, you might be owed money.
To check eligibility, gather your finance documents and note details like the lender, dealer, and interest rate. Tools and guides from experts can help identify red flags in your agreement.
Claiming car loan compensation UK involves a straightforward process, but professional assistance ensures the best outcome. Â We can start by writing to your lender or dealer, citing the undisclosed commissions or unclear terms. Working with our specialised team here at Your Lawyers can streamline this, as we handle paperwork, negotiations, and representation on a no-win, no-fee basis. Our expertise in finance cases means we can maximise your compensation.
Do not miss out on potential refunds—millions may be ready to claim damages for financial mis-selling. If you believe you have been affected by undisclosed commissions or unclear finance terms, reach out to Your Lawyers for a free eligibility check.
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