Car Finance Compensation Claim: How to Claim, and the New Hearing Dates

The legal challenge to the FCA's car finance compensation scheme will now take longer to hear. On 26 October the FCA confirmed that the Upper Tribunal has extended the hearing from 16 to 26 February 2027 to 16 February to 3 March 2027 [2], with a judgment expected in the following months [1]. Until then, lenders do not have to calculate or pay compensation [1]. Here is how to claim in the meantime.

Are you eligible?

You may be owed compensation if you used finance for a car, motorbike or van between 6 April 2007 and 1 November 2024 and were not told about certain arrangements between the lender and the broker [1]. The FCA estimates 37% of agreements from that period qualify, around 12.1 million [1].

You are outside the scheme if [1]:

• you leased the car on Personal Contract Hire;
• the Financial Ombudsman or a court has already decided your complaint, or you accepted compensation;
• the agreement was for business, or over £25,000 before 6 April 2008 [1];
• it was a high value loan, above the threshold for its year.

The high value thresholds rise year by year [1]:

Loans above these amounts are outside the scheme, by year taken out, in pounds

If your loan was above the line for its year and you have not complained, you will not hear from your lender under the scheme, but you can still complain in the normal way [1].

How do you make a claim?

Four steps, and the first one costs nothing [1]:

1. Complain to your lender. The FCA's list of lenders has contact details, a template letter and links to complaint forms.
2. Wait for the response. Your lender must tell you whether you are owed compensation and how much, but the timing depends on the legal challenge.
3. Reply within one month, accepting or challenging the offer. If you are unhappy, you can go to the Financial Ombudsman by the date given in the lender's letter.
4. Get paid within one month of accepting.

Not sure who your lender was? Check old bank statements, ask the dealer, or look at your credit file. The FCA points to Equifax's Car Finance Checker, which holds most car finance records back to 2007 [1].

When will you hear back?

Only if you are not owed anything, for now. Some parts of the scheme are still running, so lenders must tell those people by these dates [1]:

Agreement started	You complained by	Lender should tell you by
On or after 1 April 2014	30 June 2026	18 November 2026
Before 1 April 2014	31 August 2026	18 January 2027
Any date	After those dates	Within 5 months of your complaint

Silence after those dates does not mean you are owed money [1]. If the scheme is upheld and the judgment is not appealed, the FCA expects payments to begin in 2027 [1], at an average of around £830 per agreement [1].

What if the person who had the finance has died?

Their beneficiaries may be able to claim [1]. Complain to the lender in your own name, make clear you are claiming on behalf of someone else, and include their name, address, date of birth and any finance details you have. Expect the lender to ask for the will or the grant of probate [1].

What if you already went to court?

A claim a court has already decided cannot be considered again under the scheme [1]. If you started a court case that has not been heard, your lender can pause it and consider your case under the scheme instead, and you can then accept the offer or go back to court [1]. The FCA says the scheme is likely to be simpler and more certain than going to court [1].

Do you need a claims firm?

No. A claims management company or law firm may take up to 36% of your compensation, including VAT [1]. If you have already signed with one and want to leave, any exit fee should be reasonable for the work done, and you can exit for free if you were signed up without consent or misled [1]. Never sign with two.

Our earlier piece on where PCP claims stand works through how a payout is calculated on an example loan.

Finance still registered against a car is also the most expensive surprise when buying used. No free government check shows it, as our free car check guide explains, and our car history check guide covers where you stand if you buy one.