Is It Too Late to Claim for PCP Car Finance?

If you took out a PCP (Personal Contract Purchase) car finance agreement, you can still make a claim, depending on the details of their agreement. 

You could be affected by mis-sold car finance if you purchased a vehicle through PCP during 6 April 2007 and 1 November 2024 and were mis-sold a hidden commission.

Millions of drivers in the UK used PCP finance to buy new and used vehicles without knowing that some dealers were paid commission by lenders.

In some cases, these commission arrangements may have encouraged dealers to increase the interest rate, meaning customers could have paid more than necessary.

Can You Still Claim for a PCP Finance Agreement?

Yes, the current deadline for making a claim against a car finance lender is 31st August 2027, although this is subject to change to FCA ruling.

Many people assume they can only complain if they still own the vehicle or if their finance agreement is still active. However, this is not usually the case.

You may still be able to complain if:

• You have already paid off your PCP agreement
• You no longer own the vehicle
• You sold or returned the car
• You bought the vehicle second-hand
• You had more than one car finance agreement

The timeframe for taking out a car finance agreement is between 6 April 2007 and 1 November 2024 to be eligible.

Why Are PCP Finance Agreements Being Reviewed?

PCP finance became one of the most popular ways to buy a car because it allowed drivers to keep monthly payments lower compared with traditional hire purchase agreements.

However, concerns have been raised about certain commission models used by lenders and dealerships. Popular lenders that sell PCP car finance include Close Brothers, Blackhorse, BMW, Audi Financial Services, Stellantis and more. You can find the list of car finance lenders here via the FCA website.

In some cases, dealers could receive a larger commission if they increased the interest rate offered to the customer.

The concern is that some customers may not have been given enough information about how these arrangements worked or how they could affect the cost of their finance agreement.

This issue applies to both new and used vehicles, meaning anyone who used PCP finance during the relevant period may want to check whether they could be affected.

How Do You Know If You Could Have a Claim?

Every finance agreement is different, so there is no guarantee that every PCP customer will be eligible for compensation.

However, it may be worth looking into your agreement if:

• You used PCP finance to buy a car between 2007 and 2024
• The dealer arranged the finance on your behalf
• You were not told about any commission paid to the dealer
• You believe the interest rate or costs were higher than expected

You do not need to have kept the car to make a complaint. Previous vehicles may still count if the finance agreement falls within the relevant period.

What Are Your Options?

You can make a complaint directly to your finance provider yourself. This option is free, although you may need to spend time gathering paperwork, finding your agreement details and communicating with the lender.

Alternatively, you can use a claims management company to help handle the process. They can submit the complaint on your behalf and deal with communication, but they usually charge a fee but only if your claim is successful.

Both options for submitting a PCP claim are free to do and will not impact your credit score.

Before using a claims company, make sure you understand their fees and how much of any compensation you may need to pay them.

Is There a Deadline for Making a PCP Finance Claim?

Many drivers are asking whether they have missed their chance to complain. While there are important time limits and rules around financial complaints, it may not be too late to check whether you could have a valid claim.

If you believe your PCP finance agreement may have involved undisclosed commission, it is worth reviewing your paperwork and contacting your finance provider to find out your options.

Final Thoughts

If you used PCP car finance in the past, do not assume it is too late to make a complaint. Even if you no longer have the vehicle, your agreement may still be worth reviewing.

With potentially millions of UK motorists affected by car finance commission arrangements, checking your previous agreements could help you understand whether you may be entitled to compensation.

The first step is simply finding out whether your PCP agreement could have been affected.