Car finance complaints

If you’ve used car finance, you may be owed compensation. Find out how to complain and what to expect.

First published: 11/01/2024 Last updated: 19/12/2024 See all updates

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If you’ve used car finance to buy a car, motorbike or van, it’s very likely that the lender paid the broker (usually your car dealer) commission for arranging the loan.

On 25 October 2024, the Court of Appeal ruled on 3 cases involving car finance. In these cases, the Court decided it was against the law for the dealers to receive a commission from the lender without first telling the customer about the commission and getting their informed consent to the payment.

Getting informed consent will depend on the facts of each case. In these cases, it included telling the customer about the amount of commission and how it was calculated.

The lenders involved in the case are appealing the decision to the Supreme Court[1], which is the highest court in the UK. But unless the Supreme Court overturns the decision, this is now law, which car finance providers must follow.  

Most car finance deals arranged through a dealer involve commission. If you’re concerned that you weren’t told about commission and may have paid too much for your car finance, then you should complain.

If you’ve already made a complaint about a discretionary commission arrangement (DCA), find out what to do next.

If you were told by your provider your loan didn’t involve a DCA, but you’re now concerned about another type of commission, you can make a new complaint to your provider. 

If you’d like to receive an update on our work involving car finance complaints and what it means for you, sign up for email updates[2].

Giving providers longer to respond to complaints

We previously gave car finance providers until after 4 December 2025 before they had to start responding to complaints involving discretionary commission arrangements (DCAs).  

Car finance providers are likely to receive a high volume of complaints in response to the Court of Appeal judgment, including complaints about other types of commission. So, we've now given providers until after 4 December 2025 before they have to start responding to any other type of car finance commission complaint.

It’s important that any complaints are dealt with in a consistent, efficient and orderly way. Given the high number of possible complaints, there’s a risk this might not happen if we don’t provide an extension.

Managing this risk is important because this borrowing isn’t covered by the Financial Services Compensation Scheme (FSCS)[3]. This means if your provider goes out of business, you may not get the money you’re owed. 

Who this applies to

This applies to you if:

If this doesn’t apply to you, but you have a complaint about another issue, find out how to complain[5].

How to complain

  1. 1

    Get in touch with your provider (either your lender or broker)

    Tell your provider why you want to complain about commission on your car finance agreement. Include as much information as you can to help them find your loan. For example, your:

    • name
    • policy number
    • date of the agreement
    • vehicle number plate
    • address when you took out the agreement

    If you’re not sure who your provider was, but the agreement was active in the last 6 years, you can try checking your credit file as your provider may be listed on there. Find out how to access your credit file for free from the Information Commissioner’s Office[6]. 

  2. 2

    Getting a response from your provider

    Once you've made a complaint, your provider should send you an acknowledgement. But they won’t have to send you a final response until after 4 December 2025.

  3. 3

    Taking your complaint to the Financial Ombudsman Service

    It’s important you contact the Financial Ombudsman[7] by the date given in your provider's final response letter, or they may not be able to help.

    If you're sent (or have been sent) a final response to a complaint during the following periods:  

    • For a complaint about a DCA, between 12 July 2023 and 20 June 2024.
    • For a complaint about any kind of motor finance commission (including DCAs), between 21 June 2024 and 29 January 2026.

    You'll have until the later of 29 July 2026 or 15 months from the date the final response letter was sent to take your complaint to the Financial Ombudsman.

    If you’ve already been sent a final response and now have more time to take your complaint to the Financial Ombudsman, your provider will write to you and let you know.

If you’ve already made a complaint about a DCA

Click the buttons below for step-by-step information on what to do if you’ve already complained about a DCA.

How did you complain?

  • Before the Financial Ombudsman can consider your complaint, you'll need to complain to your provider.

    If you make your complaint now, your provider will have until 30 January 2026 to respond.

    If you're not happy with their response, or you don't hear from them by this date, you can then complain to the Financial Ombudsman Service.

  • Claims management companies (CMCs) are aware of the time limits that apply depending on the stage of your complaint. Your CMC should keep you up to date on the progress of your complaint.

    Contact your CMC if you want more information.

When did you complain?

Have you had a response from your provider?

You may have had a written response or a final response.

A written response will explain why your provider can't give you a final response. It should also indicate when it expects to be able to do so.

A final response will either offer you compensation, a remedy to your complaint, or it will reject the complaint and give you reasons for doing so.

  • You can now take your complaint to the Financial Ombudsman Service. However, you may choose to wait to give your provider more time to respond.

    Your provider should have acknowledged your complaint and sent you a written response. In this, it should have:

    • explained why it hasn't given you a final response
    • indicated when it expects to be able to do so

    If you haven't heard from your provider, you should get in touch with it to check that it's received your complaint.

    If your provider sends you a final response and you want to go to the Financial Ombudsman Service, you should do so by the date given in the final response letter.

Have you taken your complaint to the Financial Ombudsman Service?

  • If you have any questions about your complaint you should contact your investigator at the Financial Ombudsman Service[8].

  • If you were told by your provider your loan didn’t involve a DCA, but you’re now concerned about another type of commission, you can make a new complaint to your provider.

    If you were told by your provider that your loan did involve a DCA, but you're unhappy with their response, you can complain to the Financial Ombudsman Service.

    It’s important you contact the Financial Ombudsman by the date given in the final response, unless your provider contacts you to say you have more time.

    You should think carefully before accepting any offer from your provider. If you accept an offer in full, you won't be able to take the same complaint to the Financial Ombudsman Service or pursue the case in court.

    But if your provider has offered you compensation, taking your complaint to the Financial Ombudsman doesn't necessarily mean you'll get a better result.

Have you taken your complaint to the Financial Ombudsman Service?

  • If you have any questions about your complaint you should contact your investigator at the Financial Ombudsman Service[8].

  • You can now take your complaint to the Financial Ombudsman Service. However, you may choose to wait to give your provider more time to respond.

    If you wait for your provider, but you're unhappy with their final response, you'll need to complain to the Financial Ombudsman Service by the date given in the final response letter.

Have you had a response from your provider?

You may have had a written response or a final response.

A written response will explain why your provider can't give you a final response. It should also indicate when it expects to be able to do so.

A final response will either offer you compensation, a remedy to your complaint, or it will reject the complaint and give you reasons for doing so.

  • Your provider should have acknowledged your complaint. If it hasn't, you should get in touch to check it's received your complaint.

    Normally, your provider would have 8 weeks to respond to your complaint. But we're pausing this process.

    This means that if you complained on 28 December 2023 (2 weeks before the pause started on 11 January 2024), your provider will then have 6 weeks to get back to you after the pause ends on 4 December 2025.

    If you're not happy with their response, you can then complain to the Financial Ombudsman Service.

    It’s important you contact the Financial Ombudsman Service by the date given in the final response from your provider, or they may not be able to help.

Have you taken your complaint to the Financial Ombudsman Service?

  • If you have any questions about your complaint you should contact your investigator at the Financial Ombudsman Service[9].

  • If you were told by your provider your loan didn’t involve a DCA, but you’re now concerned about another type of commission, you can make a new complaint to your provider.

    If you were told by your provider that your loan did involve a DCA, but you're unhappy with their response, you can complain to the Financial Ombudsman Service.

    It’s important you contact the Financial Ombudsman within 15 months of being sent your final response or by 29 July 2026 if this is later, otherwise they may not be able to help.

    You should think carefully before accepting any offer from your provider. If you accept an offer in full, you won't be able to take the same complaint to the Financial Ombudsman Service or pursue the case in court.

    But if your provider has offered you compensation, taking your complaint to the Financial Ombudsman doesn't necessarily mean you'll get a better result.

Have you taken your complaint to the Financial Ombudsman Service?

  • If you have any questions about your complaint you should contact your investigator at the Financial Ombudsman Service[10].

  • Although you can now take your complaint to the Financial Ombudsman Service, you may want to wait and give your provider more time to issue a final response.

    If you're unhappy with their response, you can then complain to the Financial Ombudsman Service.

    It’s important you contact the Financial Ombudsman by the date given in the final response from your provider, or they may not be able to help.

Have you had a response from your provider?

  • Your provider should have acknowledged your complaint. If it hasn't, you should get in touch to check it's received your complaint.

    Your provider has until 30 January 2026 to respond to your complaint.

    If you're unhappy with their response, or they don't respond by this date, you can then complain to the Financial Ombudsman Service.

    It’s important you contact the Financial Ombudsman Service by the date given in the final response from your provider, or they may not be able to help.

Have you taken your complaint to the Financial Ombudsman Service? 

  • If you have any questions about your complaint you should contact your investigator at the Financial Ombudsman Service[11].

  • If you were told by your provider your loan didn’t involve a DCA, but you’re now concerned about another type of commission, you can make a new complaint to your provider.

    If you were told by your provider that your loan did involve a DCA, but you're unhappy with their response, you can complain to the Financial Ombudsman Service.

    It’s important you contact the Financial Ombudsman within 15 months of being sent your final response for by 29 July 2026 if this is later, otherwise they may not be able to help.

    You should think carefully before accepting any offer from your provider. If you accept an offer in full, you won't be able to take the same complaint to the Financial Ombudsman Service or pursue the case in court.

    But if your provider has offered you compensation, taking your complaint to the Financial Ombudsman doesn't necessarily mean you'll get a better result.

 

Taking your complaint to court

You can also bring a claim about your car finance commission to court. If you’re considering this option, you should think about getting independent legal advice.

Help making a complaint

It’s free and simple to complain to your provider and then the Financial Ombudsman if you’re unhappy with a financial product or service. You don’t need to use a claims management company (CMC). 

The Financial Ombudsman has information about car finance complaints[7], and if you’re concerned about the process, you can get free guidance from MoneyHelper[3].

A CMC can make a complaint for you, but you’ll have to pay a fee[4]. If you're thinking about using a CMC, or another type of claims management service, find out what to expect[5].

Our review into discretionary commission arrangements (DCAs)

We’re currently investigating the use of DCAs in car finance.

Before January 2021, some lenders allowed brokers (the person that arranges your loan, for example, your car dealer) to adjust the interest rates they offered customers for car finance. The higher the interest rate, the more commission the broker received. This was known as a discretionary commission arrangement (DCA).

DCAs created an incentive for brokers to increase how much people were charged for their car loan. We banned this practice in 2021. But there have since been a high number of complaints from customers about how much they were charged before the ban. Providers were rejecting most of these complaints, because they believe they haven’t acted unfairly and haven’t caused customers to lose out.

We plan to set out next steps in our review in May 2025. We hope to also provide an update on motor finance non-DCA commission complaints at the same time. Given the Court of Appeal’s judgment affects both types of complaint, what we can say in May will depend on the progress of the appeal to the Supreme Court and the timing and nature of any decision.

If you’d like to stay up to date on our work and what it means for you, sign up for email updates[2].

Protect yourself from scams

Beware of scammers pretending to be from the FCA. We’d never ask you to transfer money to us and we’d never ask for your bank account PINs and passwords.

Find out about how to spot fake FCA communications[6], and some of the common tactics scammers use.

: Information changed following 19 Dec policy statement
: Information changed following new proposals.
: Information added Update on our work and update to decision tree
: Information changed Update on our work and timeline added.
: Editorial amendment Initial instructions added to the decision tree.
: Link changed Broken link to 'next steps' fixed.
: Editorial amendment Steps added to decision tree, and information on scams and checking credit file.
: Information added motor vehicle examples
: Link added to email updates.

More information

Your rights with financial services[7]
Using claims management companies[8]
Protect yourself from scams[9]

Source URL: https://www.fca.org.uk/consumers/car-finance-complaints

Links