Mis-Selling Car loans Supreme court ruling etc.

muon said:
FCA have now published what is gonna happen.

FCA to consult on a compensation scheme for motor finance customers

We will consult on an industry-wide scheme to compensate motor finance customers who were treated unfairly.
www.fca.org.uk www.fca.org.uk

They believe the remedy they will put in place will cost between £9bn and £18bn, the midpoint is their actual estimate, when you take into account administration costs.

The payouts will be all commission (including DCA) plus around an average 3% interest rate.

For those not using CMCs, they can expect to receive on average £950 per contract. They also expect lenders to actively tell people that borrowed as well, so take up should high. It covers everything from 2007 to 2021.
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I've had several pcp's since then so wondering if I'm going to be contacted.
 
johnson case

312. Secondly, the Court of Appeal considered (at para 161) that the difference between
the sum borrowed and paid to the dealer and the actual value of the car “was largely
Page 98
accounted for by commission”. It proceeded on the basis that the discrepancy between
the cash price of the car and the Glass’s Guide valuation, as reflected in the personal loan
of £1,595.31, was largely accounted for by the payment of the commission of £1,650.95.
It considered (at para 154) that the proceeds of the additional personal loan were, in effect,
required to pay the dealer the commission, and that if the commission had not been
payable Mr Johnson would have been able to fund the purchase at the actual Glass’s
Guide price using the hire purchase agreement which the lender offered. However, linking
the two in this way was a factual error on the part of the Court of Appeal. On behalf of
Mr Johnson, Mr Weir accepts that the similarity in amount between the commission paid
by FirstRand and the personal loan was a coincidence, and he did not seek to support the
Court of Appeal’s conclusion on unfairness on that ground.

..


(i) The size of the commission
323. The commission paid by FirstRand to The Trade Centre Wales was £1,650.95.
This must be compared with the total amount payable by Mr Johnson under the credit
agreement of £9,422.20 (17.5%), the advance of credit of £6,399 (26%), the total charge
for credit (comprising interest and fees) of £3,023.20 (55%) and the interest payments
alone of £2,635.20 (63%).
324. In support of his case on the size of the commission Mr Weir, on behalf of Mr
Johnson, relies heavily on the decision of this court in Plevin. That case was concerned
with payment protection insurance (“PPI”) which was taken out by Mrs Plevin in
conjunction with a loan from the lender’s designated PPI provider. The lender paid
commission to the broker in respect of both the loan and the PPI and itself received
commission from the PPI provider. As a result, 71.8% of the PPI premium was made up
of commission, not disclosed to the claimant, which was shared by the broker and the
lender. Lord Sumption, with whom the other members of the Supreme Court agreed,
noted (at para 18) that Mrs Plevin must be taken to have known that some commission
would be payable to intermediaries out of the premium before it reached the insurer.
However, Lord Sumption explained, at some point commissions may become so large
that the relationship cannot be regarded as fair if the customer is kept in ignorance.
Wherever the tipping point may lie, the commissions paid in that case were a long way
beyond it. Mrs Plevin did not have to take PPI at all. Any reasonable person in her position
who was told that more than two thirds of the premium was going to intermediaries would
be bound to question whether the insurance represented value for money. The fact that
she was left in ignorance made the relationship unfair
..
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Would be something special if sellers ended up obliged to present information to the ignorant buyer which spelled out if the deal on the table was value for money.
 
Hotwired said:
Would be something special if sellers ended up obliged to present information to the ignorant buyer which spelled out if the deal on the table was value for money.
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Yeah, people need help seeing the overall amortised cost of everything and then putting that in context.. it would be good if there could be a rating system that had to be applied and shown to the customer..

i.e. Finance rates with 1% of the current lending rate at high street banks = A, within 2% = B, all the way to 10%+ = F that kind of thing..

Also, in very large letters you need the statement, "OVER THE 36 MONTHS OF THIS AGREEMENT YOU WILL HAVE PAID £28,565 (WHICH IS THE EQUIVALENT OF £793 PER MONTH) TO THE FINANCE COMPANY FOR THIS VEHICLE AND STILL OWE £14,177"

They know precisely what they are doing, they construct the forms to be numeric overload, all fonts are designed to not draw attention to things and most people, despite knowing better, pyschologically gloss over the initial payment and just think the monthly figure is affordable which is more important to their daily lives..
 
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Looking at the latest updates, it says there is a huge amount earmarked for paying out, this includes DCA claims?

So its looking like i might get the payout for the DCA claim i put in for blackhorse and one for Bluemotor finance?

When will we likely find out ?
 
have you done some calculations that would indicate you were a victim ? indicated loan rate considering total charge for credit.

e: probably need to plug in some estimates of loan rates into a calculator to see which hits the total amount you payed
jpaul said:
to pay an additional £1.1K over four years +£20p/m complex interest on 10K/48mnth loan
looks likre you are doubling the raw interest rate - wouldn't you notice that difference between different dealers.
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jpaul said:
have you done some calculations that would indicate you were a victim ? indicated loan rate considering total charge for credit.

e: probably need to plug in some estimates of loan rates into a calculator to see which hits the total amount you payed
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The lenders stated that both of my loans back then from both providers did have DCA
 
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yes - if you feel you have a competitive interest rate, plus sales price, after some negotiation on deductions - you fold;
you know the salesman has some commission component in the price and the loan rate, and chose that package nonetheless, versus another dealer.

it's not dissimilar to the lauded o% apr that dealers offer, you know it is not really 0%, rather the price reductions you negotiate will be minimal and the price still includes a salesman commission, plus interest.
Are we negotiating - always

I'm intrigues by the supposed 'one-price' schemes from the likes of Tesla and Mercedes (for the sensitive GenZ)
if you were privately buying that product on cash/HP wouldn't you negotiate, knowing that product costs into the (volume reduction)leasing market, or PCP are different/lower.
 
I got a "your historical finance agreement had a DCA" confirmation today.

Will I get any compensation in 2026? The news is indicating around £950 the Youtube adverts are indicating £4000!

Its important, I have been browsing Ferraris ;)
 
david25 said:
I got a "your historical finance agreement had a DCA" confirmation today.

Will I get any compensation in 2026? The news is indicating around £950 the Youtube adverts are indicating £4000!

Its important, I have been browsing Ferraris ;)
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That dependent whether the commission part is deemed unfair.
 
david25 said:
I got a "your historical finance agreement had a DCA" confirmation today.

Will I get any compensation in 2026? The news is indicating around £950 the Youtube adverts are indicating £4000!

Its important, I have been browsing Ferraris ;)
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www.theguardian.com

Now fraudsters are trying to mis-sell you a car loan payout

Motorists, who could be owed up to £950 if they were mis-sold finance, are being asked by ‘the lender’ for their details. Don’t fall for it
www.theguardian.com www.theguardian.com

Check this article.
 
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