How to complain about mis-sold car finance

The regulator, the Financial Conduct Authority (FCA), is looking at extending the time companies have to respond to complaints.

Following a Court of Appeal ruling, the FCA will be investigating car finance complaints involving all commissions, including fixed commissions – not just discretionary commission arrangements (DCAs).

This means many more people could be due compensation. We’re waiting to learn more on how this will work, but it’s a good idea to submit your complaint as soon as possible.

The following guidance on complaints if you were sold finance with a DCA remains the same. 

Before it was banned on 28 January 2021, some car dealers and credit brokers were allowed to decide the interest rate you’ll pay.

They earnt more money if they sold you a higher interest rate, known as a discretionary commission arrangement. 

This means many could have been mis-sold car finance, including:

• Personal Contract Purchase (PCP), and 

• Hire Purchase (HP).

But this doesn’t apply to car leasing – also called Personal Contract Hire (PCH). 

Thousands have already complained that they might have overpaid, but most have been rejected by lenders. 

To help, the Financial Conduct Authority (FCA) has launched an investigation to see if firms have done anything wrong – and whether complaints are being managed fairly.

The idea is to tell lenders how to handle these complaints and the best way for them to hand out any compensation owed. The FCA is expected to announce its findings and next steps in May 2025. 

While the FCA works this out, lenders don’t need to reply to new (and some recent) complaints. This is currently due to last until after 4 December 2025, but it’s still worth complaining now. 

Firms must charge you fairly, so you should get compensation if finance has been mis-sold. This applies to any finance taken out on a vehicle for personal use, including cars, vans, campervans and motorbikes.

This is often calculated on a case-by-case basis, but might include:

• a refund of your repayments

• goodwill payment, and 

• interest on top.

The FCA might decide to tell firms how to work this out, depending on the outcome of their investigation.

Some companies have claimed that they’re not within the scope of the investigation – you can see a list of these companies not using Discretionary Commission Arrangements on MoneySavingExpertOpens in a new window

Scammers might contact you to say that you’re owed compensation, and will ask for your details so they can gather information about your identity. 

Be careful of anyone contacting you unexpectedly about mis-sold car finance. In almost all cases, this is a scam.

Before complaining, it’s worth checking any paperwork you have (like a finance agreement) to see if it mentions commission, and to check it was taken out before 28 January 2021. 

Some car finance would have been sold with no commission, or a fixed commission unrelated to the interest rate you got.

If you’re not sure, still complain to your lender. It’s free to do and up to them to investigate your case. 

If you’re not sure which company you need to direct your complaint to, you can: 

• ask your dealer who supplied the finance 
  
• check on your credit file, as it will have agreements going back 6 years.
  

It’s possible that your provider was taken over by a new company – in this case, you can still make a complaint.

Here’s how to make a new complaint:

1. Gather any information about your car finance. You can usually complain within three years of noticing something was wrong, or six years of being sold the finance. 
2. Complain to your lender, ideally in writing. Tell them you think you’ve been overcharged and include as much information as you have.
   Which? has a free template on how to complainOpens in a new window and MoneySavingExpert also has a free templateOpens in a new window you can use. 
3. Your lender will review your case and provide a final response, including what they will do to put things right. They currently have until at least 4 December 2025 to do this.  
4. If you’re unhappy with the final response, or they don’t reply in time, you can take your complaint to the free Financial Ombudsman Service (FOS). How long you have to complain to FOS depends on when you receive your final response.
   
5. The FOS will give you an independent decision on whether your lender’s response was fair or if they need to do more.  

Think carefully before using a company to make your complaint. 

They’ll usually take a large chunk of any compensation you receive and follow the same process you could easily do yourself.

If you’re unhappy with your provider’s final response, you can complain to the Financial Ombudsman ServiceOpens in a new window

You’ll need to take your complaint to the Financial Ombudsman before the deadline: 

• If you’re sent a final response between 12 July 2023 and 29 April 2025, you’ll have until 29 July 2026 to complain to the Financial Ombudsman. 
  
• If you’re sent a final response between 30 April 2025 and 29 January 2026, you’ll have 15 months from the date it was sent to complain to the Financial Ombudsman. 

This gives you extra time to see the outcome of the FCA investigation before taking your complaint further.

Tens of thousands have already complained, but most of these have been rejected by lenders.

This is the main reason the FCA has stepped in to investigate.

If you’ve already accepted an offer or the Financial Ombudsman Service (FOS) has sided with the lender, you won’t be able to complain again (unless you choose to go to court). 

Otherwise you have more options.

If you've complained before 17 November 2023, your lender had eight weeks to give you a final response. 

If the lender hasn’t responded in time, or you’re unhappy with the response, you can take your complaint to the free Financial Ombudsman Service for an independent decision.

You’ll need to make sure you complain to the Financial Ombudsman by the date given in the final response.

If you've complained between 17 November 2023 and 10 January 2024 and are unhappy with your lender’s final response, you can take your complaint to the free Financial Ombudsman Service for an independent decision. 

But you might want to wait to see the outcome of the FCA investigation first.

You’ll need to complain to FOS by whichever comes later, either:  

• 15 months from the date the final response was sent, or 
  
• 29 July 2026.
  

You have 15 months from the date the final response was sent to take your complaint to the FOS.

If you haven’t received a final response, the usual eight week deadline for your lender to reply has been paused. 

Instead, they should explain what’s happening and how your complaint is affected, under current timelines, the latest you should hear back is 4 December 2025.

Your provider has until 30 January 2026 to respond to your complaint. They should still acknowledge your complaint – if they don’t, get in touch with them to check they’ve received it. 

Once you get a final response, you can take your complaint to the free Financial Ombudsman Service for an independent decision.  

But you might want to wait to see the outcome of the FCA investigation first. 

You’ll need to complain to FOS by whichever comes later, either:  

• 15 months from the date the final response was sent, or 
  
• 29 July 2026.
  

You can still complain if you have a problem with car finance taken out after 28 January 2021. 

You’ll just follow the normal complaints process and standard timeframes. 

See How to complain if you’ve been mis-sold for more help.