Mis-selling happens when key details are left out or misrepresented, and it can leave you paying more than you expected. Knowing the signs can save you a lot of hassle down the line.

Signs You Weren’t Given Full Information

If your dealer didn’t fully explain the key parts of your Personal Contract Purchase (PCP) deal, you might have been mis-sold. This could include unclear interest rates, hidden charges, or vague details about how much the car will cost at the end of the contract. Be wary if the dealer rushed through the paperwork without giving you time to understand everything.

Look out for things like:

• Interest rates not clearly stated
• No mention of balloon payments
• Missing information on early exit fees

If these weren’t discussed, it’s worth revisiting the deal to see if you were mis-sold PCP.

Were the Terms of the Final Payment Explained Clearly?

The balloon payment, or the large lump sum at the end of a PCP deal, should be fully explained. Many people are caught off guard by this final payment because the dealer didn’t explain it properly. If the option to purchase the car wasn’t made clear or you were given the impression the final payment would be minimal, this is a red flag.

Ask yourself:

• Did you know the exact amount of the final payment?
• Were you aware of your options at the end of the term?

If not, your PCP deal may not have been explained correctly.

Did the Dealer Assess Your Financial Situation?

Dealers are supposed to make sure the deal they offer is affordable for you. This means looking at your financial situation, such as your income and existing expenses. If they didn’t do any affordability checks or rushed through the process, you might have been mis-sold a deal that’s too expensive for you in the long run.

Indicators of poor checks include:

• No discussion about your monthly income
• No mention of how other debts might affect your ability to pay

A lack of these checks can signal mis-selling, especially if your repayments are now unaffordable.

Were You Pressured to Buy Additional Products?

Some dealers might push you into buying extras you don’t need, like GAP insurance or extended warranties. If you felt pressured or were told these were required to complete the deal, you might have been mis-sold. These add-ons should always be optional, and you should know exactly what you’re paying for.

Watch for these pressure tactics:

• Forced add-ons to close the deal
• Unclear explanations of why you need the extras

If you were sold unnecessary products, you might have grounds for a claim.

Misleading Advertising or Promotions

Sometimes dealers run promotions that aren’t as straightforward as they seem. You might be drawn in by low monthly payments only to find out that important details, like interest rates or mileage limits, weren’t clearly stated. If the promotion you saw didn’t match the deal you signed up for, this could indicate mis-selling.

Key things to look out for:

• Were promotional rates only available under certain conditions?
• Was the small print skipped over during your discussion?

If the reality doesn’t match the advert, you may have been misled.

Understanding Mileage Limits and Excess Charges

Mileage limits are a major part of any PCP deal, and exceeding these can lead to significant excess charges. If your dealer didn’t explain how much you’d be charged for going over the limit, or didn’t clearly state the mileage cap, you could have been mis-sold. Not being informed about these fees could lead to unexpected costs at the end of the contract.

Check your deal for:

• Clear mention of the mileage cap
• Explanation of excess mileage fees

If these were glossed over, you might have grounds for concern.

Verifying Commission Disclosure

Dealers often earn commissions on the deals they sell, but they are required to tell you about it. If your dealer didn’t disclose they were getting a commission or didn’t explain how it affected the terms of your deal, you might have been mis-sold. Knowing this information could have influenced your decision.

Things to consider:

• Were you informed about the dealer’s commission?
• Did you feel it impacted the deal’s terms?

If commission disclosure wasn’t clear, it may have influenced the fairness of your deal.

Steps to Take If You Spot These Warning Signs

If any of the above points sound familiar, don’t panic. There are steps you can take to resolve mis-sold car finance deals, including PCP. Start by gathering all your paperwork, including the original contract and any emails with the dealer. Review everything to see if there were any discrepancies.

Next steps include:

• Contacting the dealer or lender for clarification
• Seeking legal advice or speaking to a claims management company

Taking action quickly can help you avoid further financial strain.

Bottom Line

Spotting a mis-sold PCP deal isn’t always easy, but by knowing what to look for, you can protect yourself from costly mistakes. If anything seems off or wasn’t explained properly, it’s worth checking your paperwork and taking action sooner rather than later.

If you think your PCP deal was mis-sold, don’t wait—get help and explore your options.