If you financed a vehicle between April 2007 and January 2021 you could claim £1,000s

PCP contracts are Personal Contract Purchase agreements. This kind of agreement is typically used when a consumer wishes to purchase a vehicle ‘on finance’ i.e. the consumer cannot typically justify outlaying the cash price of a vehicle and will instead make monthly payments. PCP agreements usually run for a fixed term (between 36 and 48 months). Typically, the consumer will pay a deposit to the finance company followed by a fixed number of monthly payments. However, the consumer will not own the vehicle at the end of the agreement and will instead have an ‘optional final payment’ or ‘balloon payment’. This is usually a much larger final payment than the regular monthly payment (many thousands of pounds). Should the consumer make the optional final payment, they will take ownership of the vehicle. Usually, consumers do not pay the optional final payment and instead return the vehicle to the dealership or ‘trade’ it in for another vehicle.

Unfortunately, a consumer cannot tell if they have been mis-sold a PCP agreement just by looking at their finance documentation. PCP mis-selling is predominantly concerned with the payment of a secret commission from the finance company to the dealership. With that being said, the easiest way to determine whether you may have been mis-sold a PCP agreement is to look at the interest rate on your finance agreement. Typically, the higher the interest rate, the higher the chance that a secret commission payment has been made to the dealer and a PCP contract has been mis-sold.

There are however many factors that need to be assessed when analysing the merits of your claim, such as the overall value of the car your purchased compared to the size of the deposit you paid and whether you feel that correct affordability checks were carried out regarding your financial circumstances.

To find out if you are eligible for a claim, you can use our eligibility checker on our website under the ‘Mis-sold Car Finance Claims’ section. This will take you through a few questions relating to your finance agreement on the vehicle, and you will receive an instant decision on whether you are eligible to claim. click here to begin your claim. Our Service is free and confidential, we are here to help.

In order to make a claim, we need a copy of your PCP finance agreement. It will also be of assistance to know the date of the final payment made on your finance agreement. If you don’t have a copy of your finance agreement, we can request a copy from your finance company – but you will need to tell us which company your finance agreement was with.

The announcement is significant for consumers as it demonstrates just how seriously the FCA are taking the issue of mis-sold car finance.

The Financial Conduct Authority (FCA) announced on 11 January 2024 that it was going to undertake work in the motor finance market. Subsequently, the FCA placed a pause on the 8-week deadline finance companies had to provide a final response to the consumer once a complaint had been made by the consumer. The pause has been introduced to prevent disorderly, inconsistent, and inefficient outcomes for consumers whilst the FCA assess the issues and determine the best way forward.

How much compensation you may be eligible to receive depends on the amount of commission paid to the dealership by the finance company. It also depends on how much the dealership used their discretion when setting your interest rate. If the dealer set your interest rate at the highest available to them, you may be eligible to more compensation.

JLG have been successfully bringing these claims to Court for the last 3 years and the compensation figure is generally calculated using a combination of a repayment of the commission that was paid, and the difference in interest rates between what you were charged and what you should have been charged if you were treated fairly.

Yes!

Numerous consumers have successfully won PCP claims resulting in their finance company being ordered to pay compensation. Following recent decisions by the Financial Ombudsman Service, we are expecting to see a significant rise in successful PCP claims for consumers.

Most clients can expect that their claim will be resolved within the region of 12-24 months of instructing us, however there are no guarantees. The industry is currently awaiting the outcome of the FCA’s ongoing assessment, and determination of next steps, which is due to be reported in Q3 of 2024

You will not be required to pay anything upfront in bringing a PCP mis-selling claim with Johnson Law Group. We conduct these claims on a No Win, No Fee basis, meaning that unless your claim is successful, you will not pay a penny. If your claim is successful, our fee is taken from your compensation, meaning that you will never be out of pocket for bringing a PCP mis-selling claim with us.