Car Finance Compensation: How to Claim Free (UK, 2026)

If you took out car finance in the UK between 6 April 2007 and 1 November 2024, you may be owed compensation. The FCA estimates 12.1 million agreements are eligible, with an average payout of around GBP 830. You can complain yourself, free, and keep all of it.

Important, as at 28 July 2026: the redress scheme was legally challenged and parts of it are suspended. Lenders do not currently have to calculate or pay compensation. Complaint deadlines still apply, so there is still a reason to act now. The detail is below.

What is actually happening right now

The FCA set up a redress scheme for people sold motor finance with undisclosed or unfair commission arrangements. After it launched, four parties challenged it: Consumer Voice, Volkswagen Financial Services, Mercedes-Benz Financial Services and Credit Agricole Auto Finance.

On 2 July 2026 the Upper Tribunal suspended parts of the scheme. In the FCA's own words, "until the legal process ends, lenders do not need to calculate or pay compensation to people owed money under the scheme". The challenge will be heard between 14 and 18 December 2026, or 16 and 26 February 2027.

If the scheme survives and there is no appeal, the FCA expects payments to begin in 2027.

What that means for you: money is not arriving this year. But the deadlines for complaining have not been suspended, and complaining now puts you in an earlier response queue. Anyone telling you a payout is imminent is either out of date or selling something.

The deadlines that matter

These are the dates that decide when, and whether, your complaint gets picked up.

• Agreement started on or after 1 April 2014: the deadline to complain was 30 June 2026. That has passed. Lenders should contact people in this group by 18 November 2026.
• Agreement started before 1 April 2014: the deadline to complain is 31 August 2026. Lenders should respond by 18 January 2027. This is the live one.
• Never contacted by anyone: if you have concerns and nobody has been in touch, you can still complain to your lender up to 31 August 2027.

Missing the 30 June date does not necessarily end your claim, because lenders are still required to review eligible agreements. It does mean you are relying on being found rather than putting your own case in.

Are you eligible?

Use this as a first pass, not a legal answer.

• Personal motor finance for a car, motorbike, van or campervan
• Agreement taken out between 6 April 2007 and 1 November 2024
• PCP, hire purchase or a similar credit agreement, not a straight cash purchase
• You do not need to prove the commission type. That is the lender's job to check.

Two exclusions worth knowing. Agreements before 6 April 2008 for more than GBP 25,000 were unregulated and are not covered. High-value loans above certain annual thresholds are excluded unless the vehicle was adapted for accessibility.

You do not need the agreement number to start. Do not write off a claim because the paperwork is long gone.

How to find your lender when the paperwork has vanished

Most people no longer have the agreement. Work through these in order.

1. Old bank statements. Look for the monthly direct debit and the name behind it. The dealer's name and the lender's name are often different.
2. Your credit file. Free from the main credit reference agencies. Closed accounts usually stay visible for six years, so a recent agreement should show.
3. The dealer. Even if you have moved on, dealerships keep records and can usually tell you who underwrote the finance.
4. Equifax's Car Finance Checker. The FCA notes it includes most records back to 2007.

If the lender has since been bought or renamed, complain to the business holding the book now. A quick search of the old name plus "acquired by" usually finds it.

Complaining, step by step

1. Complain to the lender first. This is always the first step and it is free. The FCA's position is blunt: "the best thing you can do, if you have concerns, is to complain to your lender."
2. Keep it simple. You do not need to argue the law or identify the commission model. Ask them to review every eligible agreement in your name under the FCA motor finance redress scheme.
3. Give every identifier you have. Full name, any previous names, date of birth, addresses at the time, the vehicle if you remember it, rough dates, and the dealer.
4. Keep a copy of everything, with dates. If you have several agreements, keep one file per lender.
5. If they say they cannot find you, reply with more identifiers rather than giving up. A vague search is not the same as no record.
6. When a decision arrives, you have 1 month to accept or challenge it. If you accept, the lender then has 1 month to pay.
7. If you are unhappy with the outcome, the Financial Ombudsman Service is free. Wait until you have the lender's final response before going to them.

Why you should not pay a claims company

Claims management companies and claims law firms can charge up to 36% including VAT of whatever you recover. On the FCA's estimated average payout of around GBP 830, that is roughly GBP 300 of your money for filling in a form you can complete yourself.

They have no special access. They cannot make a lender pay faster, and they cannot make you eligible if you are not. The FCA says plainly that you can complain for free without one, and that you do not need one to find out whether you are eligible.

If you have already signed with one, check the contract before doing anything else, because some charge regardless of who did the work.

Scams to watch for

• Anyone asking for an upfront fee to check eligibility. Checking is free.
• Cold calls, texts or social ads claiming your payout is ready and waiting. Nothing is being paid out right now, because the scheme is suspended.
• Anyone implying they are the FCA, or acting on its behalf. The FCA does not process claims and will never ask you for a fee.
• Requests for bank details or ID from a firm that contacted you first.

FAQ

Is the car finance compensation scheme still happening? Yes, but parts of it are suspended after a legal challenge. Lenders do not currently have to calculate or pay compensation. The case is heard in December 2026 or February 2027, and payments are expected in 2027 if the scheme is upheld.

What is the deadline to complain about car finance? If your agreement started before 1 April 2014, the deadline is 31 August 2026. For agreements from 1 April 2014 onwards the deadline was 30 June 2026 and has passed. If nobody has contacted you, you can complain up to 31 August 2027.

How much is the average car finance payout? The FCA estimates around GBP 830 per eligible agreement, across roughly 12.1 million agreements. Your own figure depends on the agreement, and some people will get nothing.

Do I need a claims company to claim car finance compensation? No. You can complain directly to your lender for free, and escalate to the Financial Ombudsman for free. Claims firms can take up to 36% including VAT.

What if I have lost my car finance paperwork? You can still claim. Use old bank statements, your credit file, the dealer, or Equifax's Car Finance Checker to identify the lender. You do not need the agreement number to start.

Which agreements are covered? Personal motor finance for a car, motorbike, van or campervan taken between 6 April 2007 and 1 November 2024. Pre-April 2008 agreements over GBP 25,000 were unregulated and are excluded, as are certain high-value loans unless the vehicle was adapted for accessibility.

How long do I have to respond to a lender's offer? One month to accept or challenge it. If you accept, the lender has one month to pay.

Can I complain about more than one car finance agreement? Yes. Complain to each lender separately, and if one lender handled several agreements, list them all in the same complaint.

Sources

• FCA, Car finance claims: https://www.fca.org.uk/consumers/car-finance-complaints
• FCA, Motor finance scheme partially suspended: https://www.fca.org.uk/news/statements/motor-finance-scheme-partially-suspended
• FCA, PS26/3 Motor finance consumer redress scheme: https://www.fca.org.uk/publications/policy-statements/ps26-3-motor-finance-consumer-redress-scheme
• Financial Ombudsman Service, Complaints about car finance commission: https://www.financial-ombudsman.org.uk/consumers/complaints-can-help/credit-borrowing-money/car-finance/complaints-about-commission

Last reviewed: 28 July 2026. This guide is general information, not legal or financial advice. The scheme is subject to a live legal challenge and the position may change. Always check the FCA page above before acting.