Martin Lewis has a big update for car loan customers. Many people could get £700 back next year. This is about car finance agreements from the past. You might be owed money if you took out a car loan between 2007 and 2021.
The Financial Conduct Authority (FCA) is looking into these loans. They started their investigation in January 2024. This could be a huge payout, similar to the PPI scandal. Experts say you should act now.
FCA Investigation Targets Hidden Car Loan Fees
Car finance deals often included secret payments. Lenders paid brokers a hidden commission. This made your loan more expensive. You might not have known about these extra charges. This type of payment is called a “discretionary commission arrangement.”
The FCA believes this was unfair. They are reviewing millions of loans. These loans are mostly Personal Contract Purchase (PCP) and Hire Purchase (HP). Did you buy a car on finance in the last 17 years? Check your old paperwork.
The FCA has paused complaint deadlines. This pause lasts until September 25, 2024. This gives them time to understand the situation fully. They will decide on compensation rules after their review. Payouts could start in early 2025.
How to Claim Your Potential Car Loan Compensation Now
Martin Lewis advises everyone to make a complaint now. Do this even if you are not sure you were affected. It costs nothing to complain. You can do it yourself easily. This is a “no-brainer” for many people.
You need to contact your car finance provider. This is the company you paid your loan to. Tell them you think you had a discretionary commission arrangement. Ask them to review your agreement. MoneySavingExpert.com has a free template letter to help you.
Keep all your old car finance documents. You may need them later. Make your complaint before the FCA makes its final decision. This puts you in the queue for a potential payout. Don’t miss this chance to get your money back. Find out more about the process on the FCA car finance complaints page.
