The FCA also says that if a claimant is not contacted due to the lender not storing the appropriate information, they will have one year from the scheme starting to make a claim. Consumers are notified that they can choose not to take part in the redress scheme and go to court – potentially to receive even more compensation – although success is far from guaranteed.
Avoid car finance compensation claims firms
Auto Express also warns consumers to stay away from car finance claims firms; using one of these is totally unnecessary and could see you give up a significant portion of your compensation needlessly.
Who can claim?
According to the FCA, there are three types of people who can claim:
- Those who signed up to a discretionary commissions arrangement (the issue which caused the whole debacle and which involved lenders inflating interest rates in order to give dealers more commission).
- Those who signed up to a finance deal with excessively high commission (35 per cent of the total cost of credit and 10 per cent of the loan).
- Those who signed up to an agreement that gave the broker (often the car dealer) exclusive rights to the lender.
All agreements of the types listed above must have been signed between 6 April 2007 and 1 November 2024 to be eligible.
When will I receive compensation?
The FCA has not confirmed any dates as to when the redress scheme will commence, however, it has indicated that payouts “could start next year (2026)”.
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