Mis-sold Car Finance | Mis-sold PCP

Millions of people in the UK may have been mis-sold their car finance deal. Not only can you potentially receive compensation for an emissions claim, but you may be owed thousands from a mis-sold PCP finance agreement.

If you have purchased your vehicle on a car finance deal, your lender is obliged to inform you of exactly what is involved in that deal. You must make an informed decision so that you know it is right for you, and any salesmen or women cannot act in their best interest.

If you believe you have been mis-sold a finance deal and feel trapped, you may be owed compensation. Even if you haven’t lost money, if the car finance deal isn’t right for you and your financial situation you can potentially bring forward a claim for mis-selling.

The lender might have been misleading about the extra costs involved, or they may have charged you more they should have in order to get commission.

Our panel of solicitors can investigate your claim and tell you whether you are entitled to compensation. Find out today by completing our form.


What is PCP?

Personal Contract Purchase (PCP) is essentially a loan to help purchase a car. Car dealerships offer them for those who do not have the upfront cash to purchase a vehicle.

However, unlike a normal personal loan, you won’t be paying off the full value of the car, and you won’t own the car at the end of the deal, unless you agree to pay the final balloon payment.

The agreement normally has three parts:

  • The deposit – usually around 10% of the car’s price
  • The amount you borrow
  • The balloon payment – A large final payment if you want to own the car

You can potentially face extra charges throughout this agreement, however. These include:

  • Over-mileage charges
  • Damage charges


How might have I been mis-sold my car finance?

The issue of mis-sold PCP finance agreements comes from a lack of information being given to the customer at the time of purchase. This is usually down to miscommunication on the lender’s part.

Car finance deals can be relatively complex and sometimes have commission attached to them. This means that it is often in the salesperson’s best interest to sell you a finance agreement, even if it is not in your best interest.

Some of the main reasons you may have been mis-sold your PCP car finance deal are:


Undisclosed or hidden commission

Thousands of customers may have been completely unaware of any commission payments. If the car salesperson received a fee or commission for bringing the car finance deal to the bank, and the bank has not informed you of this, that is a hidden, secret, or undisclosed commission. The finance provider or bank must inform you of ALL of the fees within the transaction.


High-pressure sales tactics

If you were put under pressure to opt into a finance agreement that you didn’t feel was right for you, you may be able to claim compensation. The salesperson needs to give you enough time to assess the deal offered and potentially find an alternative option.


Lack of proper affordability checks

Many customers enter into loan agreements that are not suited to their financial situation. This leaves them trapped by the PCP deal, where they are not in a position to make payments throughout the whole term of the agreement.


Inflated prices and overcharges in interest

Some cases show that customers are overcharged by over £1,000 interest in order for the dealership to obtain a higher commission pay-out.


Emissions Scandal Claims

Our panel are experts in bringing forward a diesel emissions claim. We believe that if you entered the PCP agreement on the basis that you were receiving a particular type of car with a particular set of emissions, then you have been misrepresented. If this is the case, we would look to not only claim compensation from the emissions scandal, but also from the PCP agreement you entered at the time.


The FCA Report

The UK’s financial watchdog, the Financial Conduct Authority, produced a report in March 2019 into the dealings of PCP agreements within the automotive industry. 

FCA spokesman Jonathan Davidson said:

“We found that some motor dealers are overcharging unsuspecting customers over a thousand pounds in interest charges in order to obtain bigger commission payouts for themselves."

"We also have concerns that firms may be failing to meet their existing obligations in relation to pre-contract disclosure and explanations, and affordability assessments.”

In their investigation in regard to the mis-selling of Car Finance (PCP), they found that:

Out of the 122 car dealerships visited by mystery shoppers just 11 car dealerships confirmed that commission will be added on this type of deal.

You can read the full report here - https://www.fca.org.uk/publication/multi-firm-reviews/our-work-on-motor-finance-final-findings.pdf


Contact emissions.co.uk today

If you believe you have a mis-sold car finance claim, our expert panel of solicitors can help bring your claim forward.

Our specialist panel of car claims solicitors are able to bring a claim on your behalf and not only hold massive car companies and dealerships to account, but also get you compensation while doing so.

At Emissions.co.uk we make claiming for compensation easy:

  • No Win, No Fee*
  • No Upfront Payments
  • An Expert Team
  • Regulated and Authorised by The Solicitors Regulation Authority

If you would like to speak to one of our Mis-Sold Car Finance Claims Solicitors, you can do so by completing our online form.