24 Jun, 2024

Mis-sold car finance scandal: could you be due compensation?

Missold car finance

Don’t worry, Auto Express isn’t about to join the bandwagon of claims-management firms advertising on social media and elsewhere, using well-known statements to get their claws into a share of any payout you – and millions of others – may one day be entitled to as a result of a ‘mis-sold’ car finance agreement.

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At issue are finance agreements including a non-disclosed Discretionary Commission Agreement between your lender and your dealer, allowing the latter to secretly tweak interest rates for more or less commission. DCAs were banned in 2021, but were commonplace before that, especially in the franchised/prime used-car sector.

Complainants say that dealers raising rates behind customers’ backs to earn extra commission was an unfair practice. They want customers to be compensated for any additional interest paid out, a view backed by two recent decisions by the Financial Ombudsman, which is sided with a pair of complainants claiming just that.

When you look at the numbers, it’s no surprise that so many claims-management firms want a slice of a future compensation pie. Around £40billion is lent on car finance every year in the UK and, after financial advice website Money Saving Expert launched its

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