Martin Lewis says millions due to get £700 payment will find out this year
Martin Lewis says people who have fallen victim to car finance mis-selling will find out how much they will be compensated later this year.
The Money Saving Expert took to X to share an update from the the Financial Conduct Authority (FCA) on its proposed compensation scheme for customers who have been treated unfairly in motor finance deals.
It turns out that millions of customers who purchased a car on finance during or after 2007 have been mis-sold car loans.
"It is likely that the car finance was mis-sold to you due to the car dealership failing to disclose commission they were paid by the lender for setting up your car finance," according to Finance Claims.
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"Each car finance agreement could be worth around £700 and from our experience most consumers have more than one agreement, meaning you could be owed £1,820."
The FCA is reviewing more than 1,000 responses to its consultation and Lewis, who is once again doing God's work, says they will announce the final rules for the scheme in late March this year, with the announcement likely made around 5pm.
"For those who've already complained you'll be told your compensation with in three months of that, asked if you want to accept it, then paid," he said.
"That should happen by the end of 2026."
In a statement, the FCA said that 'anyone concerned they weren't told about commission involved in their motor finance deal should complain now'.
"Doing so means they should get any compensation sooner," the FCA said.
"There is no need to use a claims management company (CMC) or law firm, and those who do may lose over 30 percent of any compensation."
The authority revealed that they 'have cracked down on poor practice by FCA-regulated CMCs'.
"Over 800 misleading adverts have been removed or amended since January 2024 and we have intervened with 5 CMCs causing harm," they added.
"Two reduced exit fees and four agreed to stop taking on new clients until they can show they comply with our rules.
"People who complain before the scheme starts would no longer be asked if they wish to opt out.
"Instead, within three months of the end of the implementation period, their lender would tell them whether they are owed compensation, and how much.
"Even with an implementation period, streamlining the process means millions of people would receive compensation in 2026."
To issue a complaint, all you need to do is head to the Money Saving Expert website and use the letter template to send to your lender.
Topics: Cars, Money, UK News, Martin Lewis
Anish Vij