Personal Contract Purchase (PCP) car finance agreements have been widely mis-sold in the UK. Many consumers were not informed about commission structures, unfair terms, or their total financial liability. If you suspect your PCP deal was mis-sold, you could be eligible for compensation.
Step 1: Check if You Are Eligible
Start by reviewing your PCP agreement and the sales process. If the dealer failed to disclose commission or misled you about affordability, you may have grounds to claim. A recent Financial Conduct Authority (FCA) investigation found that hidden commissions increased consumer costs unfairly (FCA, 2023).
Step 2: Gather Your Evidence
You need proof to support your claim. Collect your PCP agreement, finance statements, emails, and any promotional material from the dealership. FCA reports show that up to 90% of car finance deals included undisclosed commissions. If you took out a finance deal with a provider like MotoNovo, you might be eligible to file a MotoNovo claim for compensation.
Step 3: Contact Your Lender First
Your first step is to formally complain to your finance provider. Explain why you believe your agreement was mis-sold and request a refund or adjustment. Lenders must respond within eight weeks under FCA rules, and many claims are resolved at this stage.
Step 4: Escalate to the Financial Ombudsman Service (FOS)
If the lender rejects your claim, take it to the Financial Ombudsman. The FOS investigates disputes for free and has ordered repayments in thousands of cases. Complaints can be submitted online, and cases are usually resolved in three to six months.
Step 5: Consider Legal Action
If the FOS does not rule in your favour, you can take legal action. Specialist solicitors handle PCP claims on a no-win, no-fee basis, but court cases may take over a year. The average successful claim is worth £3,000 to £5,000, depending on interest paid (MoneySavingExpert, 2023).
Final Thoughts
There are time limits for claiming, usually six years from the date of agreement or three years from when you discovered the issue. With the FCA investigating further cases, now is the best time to check your PCP deal. If mis-sold, you could reclaim thousands.
