Car finance compensation should be paid next year
Summary
Millions of UK drivers could receive compensation next year for car loans that were mis-sold. This involves commission arrangements between lenders and dealers and stems from a ruling by the UK's Supreme Court. The Financial Conduct Authority (FCA) is working on a compensation scheme to guide eligible motorists on how to claim.Key Facts
- Millions of UK car owners might be eligible for compensation due to mis-sold car finance deals.
- The UK Supreme Court's decision affects up to 30 million agreements made from 2007 to 2020.
- The FCA plans to launch an awareness campaign to explain who can claim and how to do so.
- Claimants are expected to receive less than £950 per deal.
- The scheme will address issues from discretionary commission arrangements, high dealer commissions, and inaccurate finance information.
- The FCA is still finalizing details like whether claims will be automatic or require opt-in.
- Some firms involved with the compensation scheme have not been cooperative with the FCA.
- Comparatively, fewer people will be eligible than in previous compensation cases like the PPI scandal.
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