If you suspect that you were mis-sold a car finance agreement, you may be entitled to reclaim the money you’ve overpaid. The process of reclaiming car finance can seem daunting, but by following a structured approach, you can significantly increase your chances of success. This guide outlines the key steps you need to take to reclaim your car finance and ensure you get the compensation you deserve.
Step 1: Understand the Basis of Your Claim
Before you begin the reclaim process, it’s important to understand the basis of your claim. Car finance agreements are often mis-sold through discretionary commission arrangements (DCAs), where dealers or brokers increase the interest rate to earn higher commissions without informing the customer. Other common issues include undisclosed fees or pressure to sign a finance deal without full disclosure of the terms.
If any of these scenarios apply to you, you may have a strong case for reclaiming the extra money you’ve paid.
Step 2: Gather Your Documentation
The next step is to gather all the necessary documentation to support your claim. This includes:
- Finance Agreement: The contract you signed when taking out the car finance, which details the interest rate, loan amount, and any additional fees.
- Payment Records: Bank statements, payment schedules, or any other records showing the payments you’ve made over the course of the agreement.
- Correspondence: Any emails, letters, or notes from conversations with the dealer or broker that might indicate mis-selling.
Having these documents organised will make it easier to build your case and provide evidence to support your claim.
Step 3: Perform a Car Finance Check
Before you file a claim, it’s a good idea to perform a car finance check to verify whether your agreement was mis-sold. This involves reviewing your finance documents to identify any signs of mis-selling, such as undisclosed commissions or inflated interest rates.
You can use our free car finance check tool to quickly assess whether your deal was fair. This tool is designed to help you identify potential issues with your agreement and determine if you have grounds to file a claim.
Step 4: File a Complaint with Your Finance Provider
Once you’ve gathered your documentation and identified signs of mis-selling, the next step is to file a formal complaint with your finance provider. Here’s how to do it:
Draft Your Complaint Letter:
Clearly state that you believe your car finance agreement was mis-sold. Include details of how the mis-selling occurred, such as undisclosed commissions or pressure to sign.
Attach copies of your supporting documents, including your finance agreement and payment records.
Submit the Complaint:
Send your complaint letter to your finance provider. It’s important to keep a copy for your records and note the date you submitted it. Many providers accept complaints via email, but you can also send it by post.
Wait for a Response:
The finance provider is required to acknowledge your complaint and will typically investigate the matter. You should receive a response within eight weeks. If they agree with your claim, they may offer compensation.
For more detailed guidance on filing a complaint, visit our How to File Car Finance Claims page.
Step 5: Escalate Your Claim if Necessary
If your finance provider rejects your complaint or offers an unsatisfactory resolution, you have the option to escalate your claim. Here’s how:
Contact the Financial Ombudsman Service (FOS):
The FOS is an independent body that resolves disputes between consumers and financial services. If your claim is rejected or not resolved within eight weeks, you can take your case to the Ombudsman.
Seek Professional Help:
Consider consulting a finance claims expert if your case is particularly complex or if you’re unsure about how to proceed. Our team specialises in handling mis-sold car finance claims and can assist you in escalating your claim effectively.
Step 6: Receive Your Compensation
If your claim is successful, you will receive compensation for the extra money you paid due to the mis-selling. This compensation can be paid directly to your bank account or used to reduce any remaining balance on your finance agreement.
The amount of compensation you receive will depend on various factors, including the difference between the interest rate you were charged and a fair market rate, the size of the loan, and the length of the loan term. For more information on what you might be entitled to, visit our Car Finance Compensation: What to Expect page.
Why You Should Act Now
If you believe you’ve been mis-sold a car finance agreement, it’s important to act quickly. There are often time limits for filing a claim, and the sooner you take action, the better your chances of success. By following the steps outlined in this guide, you can take control of your situation and reclaim the money you’re owed.
Our team of finance claims experts is here to help you every step of the way, from performing an initial car finance check to filing your complaint and receiving your compensation.
Start Your Car Finance Reclaim Process Today
