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 Elevated and inequitable interest rates, concealed commission charges, and the absence of proper affordability assessments stand as stark examples of the tactics employed by unethical lenders to take advantage of those looking to purchase a vehicle. 

 In March 2024, Nikhil Rathi, Chief Executive of the Financial Conduct Authority (FCA), delivered a speech at the Morgan Stanley European Financials Conference in London. The speech focused on adopting a ‘regulatory approach to deliver for consumers, markets and competitiveness’. As part of the speech, Rathi talked about the ongoing car finance claims situation. He mentioned how the regulator is aiming to “act proactively and thoroughly understand the problem” with the hope of achieving “earlier clarity than previous redress events.” It is noted that “the more quickly and comprehensively firms cooperate with requests for data, the sooner we [FCA] can conclude our work.” Rathi concluded by stating he expects it will be ‘improbable’ that the FCA finds nothing to report following their investigation. 

Whenever you suspect that the lender was not honest when they sold you the finance agreement. Here are some situations where you can make a car finance claim:

• Mis-sold Finance: If the credit was not suitable for your needs or financial situation, and this was not adequately assessed or explained to you, you might have grounds for a claim. This includes not being fully informed about the offer’s interest rates, terms, or total cost.
• Lack of Affordability Checks: Lenders must conduct affordability checks to ensure the consumer can comfortably meet the payment obligations. If they failed to perform these checks properly, leading you into financial distress, you may be eligible for a claim.
• High and Unfair Interest Rates: In case interest rates applied to your car finance are excessively high compared to the market rate at the time of the agreement, and you were not properly informed about this, you may be able to claim, particularly if your credit risk did not justify the high rates.
• Undisclosed Commission Fees: Should the commission earned by the lender or broker from selling you the credit product have unjustly biased their recommendation, then you may have grounds to sue.
• Incorrect Information or Misrepresentation: If you were provided with inaccurate information or the terms and conditions of the loan were misrepresented to you, leading to an unsuitable agreement, this could warrant a claim.
• Early Settlement Issues: If you were penalised for settling your loan early or were not informed about your rights and the process for early settlement, you might be eligible to make a claim.
• Voluntary Termination Rights: Under certain agreements, you can return the vehicle and terminate the agreement after paying off a specific portion of the loan. If these rights were not clearly explained to you, or you were obstructed in exercising them, you may have grounds for a claim.

In order for us to locate the finance agreement we will need to establish some details, such as your personal details, the address associated to the finance agreement, the year of the agreement, who the lender was. All of this will help us locate the agreement with the lender and then to establish sufficient grounds to substantiate a claim. Our advisors are here to provide accurate information and guide you through the entire process.

Call today for your free consultation.