Updated: 20 September 2025

Originally Published: 10 January 2025

The rise in mis-sold PCP claims has shone a light on how complex Personal Contract Purchase agreements can be. Many drivers are only now discovering that their deals may have included undisclosed commissions, inflated interest or unclear terms. If you are thinking about a mis-sold PCP claim and feel overwhelmed, you are not alone. This guide breaks things down in plain English and answers the questions we hear most about PCP claims and what counts as a mis-sold PCP agreement.

What has changed in 2025 that affects PCP claims?

The landscape for car finance claims has shifted dramatically in 2025, and it is important for anyone considering a complaint to understand what this means. Three big updates stand out.

First, in August 2025, the Supreme Court issued a landmark decision [1]. The judges made clear that commissions in car finance are not automatically unlawful, but if they were hidden from the customer or set at excessive levels, they could create what the law calls an “unfair relationship.” In practice, that means many mis-sold PCP claims remain very much alive and could succeed if the evidence shows you were overcharged.

Second, the Financial Conduct Authority (FCA) has extended its pause on handling commission-related complaints [2], including PCP claims, until 4 December 2025. This pause was introduced to give regulators time to design a fair and consistent way of resolving cases. You can still submit your complaint today, and many experts recommend doing so to secure your place in the queue, but most will not be reviewed until after the pause ends.

The FCA also said a formal consultation will be released in October 2025 and will take six weeks [3]. This consultation will outline options for an industry-wide redress scheme, bringing clarity on how refunds will be calculated and who will qualify. Final rules are expected in early 2026, and compensation payments are likely to begin later in the year.

Together, these updates mean that while customers may need to wait for their cases to move forward, the foundations for a national redress process are being laid. Acting now ensures you will be prepared once the scheme begins.

Is a PCP claim only for brand-new cars?

No. A PCP finance claim is not limited to brand-new vehicles. You can bring a claim for used cars, and for other vehicles such as motorcycles and vans, provided the finance was a PCP agreement and you meet the usual eligibility criteria. The same core rules apply where the agreement was mis-sold.

Can I make a PCP claim if my agreement has already finished?

Yes. Many mis-sold PCP claims relate to agreements that ended years ago. In general, claims based on discretionary commission arrangements focus on deals taken out between 2007 and January 2021. There are time limits in consumer law, but the forthcoming FCA process is expected to set out how older cases will be handled. If in doubt, get your complaint in so you are in the queue.

How many vehicles can I include in a single PCP claim?

If you had multiple PCP agreements in your name, you can usually raise them together. Each agreement will still be assessed on its own facts, but combining them can keep the admin tidy.

When is a PCP agreement mis-sold, and what is a PCP claim?

A complaint that your PCP agreement was misrepresented is known as a PCP claim. Common indicators include one or more of the following.

Undisclosed commissions. Many agreements used a discretionary commission model where the dealer could raise your interest rate and earn more commission. If you were not clearly told about this, you may have grounds to complain.

Key terms not explained. Balloon payments, mileage limits, wear and tear, Guaranteed Minimum Future Value and the total cost over the term should have been explained in clear, simple terms.

Affordability not assessed. Firms should check if the agreement is affordable. If you were pushed into a deal without sensible checks, that can be a problem.

Pressure selling or lack of alternatives. If you felt rushed into signing, or you were not offered a fair choice of finance options, that can also support a claim.

Are PCP claims in the UK legitimate?

Yes. PCP finance claims are a legitimate route for consumers. Regulators and courts have confirmed that undisclosed or excessive commissions can make a relationship unfair. The FCA pause means most commission-based complaints will sit until December 2025, but lodging your complaint now preserves your place in the queue.

What evidence do I need for a mis-sold PCP claim?

Helpful items include your finance agreement, any dealer or broker correspondence, payment records, and any notes or emails that show what you were told at the point of sale. If you cannot find everything, do not panic. Lenders can usually provide copies, and many claims teams can help you retrieve missing documents.

How much compensation can I expect for a mis-sold PCP claim?

There is no single number because every case depends on the size of the loan, how long it ran and how the interest was set. The FCA has indicated that the average redress for commission-related cases is around £950 per agreement [4]. Some people will see more if the overpayments were significant, while others will see less. 

How long do PCP claims take?

Under normal complaint rules, a lender has up to eight weeks to reply. But because of the FCA pause, most commission-related cases will not progress until after 4 December 2025. If you need to escalate, the Financial Ombudsman Service can take several months. The best way to use this time is to gather your paperwork and submit your complaint so you are in the system.

Is it possible for me to file a PCP complaint without a company?

Indeed. You can file a mis-sold PCP claim with the Financial Ombudsman Service if necessary [5], as well as directly with the lender. Others prefer support from a regulated claims management company or a finance claims expert because they handle the legwork, chase deadlines and spot issues that might increase the value of the claim.

What do PCP claims management companies actually do?

A regulated claims management company gathers your evidence, drafts the complaint, submits it to the lender, and manages any follow-up. If the lender makes a low offer, they will usually challenge it. Many work on a no win, no fee basis, which means a success fee is taken from any compensation if you win and nothing is charged if you lose. Verify the firm's authorisation and the precise cost at all times.

What is the no win, no fee model in this context?

It means you do not pay anything upfront. If your mis-sold PCP claim succeeds, the firm takes an agreed percentage of the compensation. If the claim fails, there is no fee. Read the terms so you understand what is included and what is not.

Should I use a claims management company or a solicitor?

Both can help. A regulated claims company often suits standard PCP claims because they are set up for volume casework and day-to-day chasing. A solicitor can be the right fit for complex or defended cases. Either way, choose a provider that is transparent on fees, regulated, and experienced with car finance claims.

How much does it usually cost to get professional assistance?

The success fee, including VAT, is around 36% of the payout for many regulated claims management firms. Similar percentages or fixed fees are charged by some law firms; in complex situations, there may be additional legal expenses. Make sure VAT is included and always request the charge in writing.

Is there a PCP claim calculator?

A PCP refund calculator can give a rough idea based on loan amount, interest rate, and period. When the FCA finalises the plan, the amount will depend on the evidence and procedures it outlines.

What if my lender rejects my PCP complaint?

You can escalate your mis-sold PCP claim to the Financial Ombudsman Service for an independent decision. The Ombudsman can tell the lender to pay compensation if it finds the agreement was mis-sold or the relationship was unfair.

Do I need all my paperwork before I start?

No. It helps, but it is not essential. You can ask the lender for copies of your agreement and statements. If you decide to use professional services, they can usually request these for you.

Does the pause mean I should wait to complain?

No. Submitting your complaint now protects your position and gets you into the queue. Although most cases will remain parked until December 2025 due to the FCA pause, being early can have an impact once the system gets going.

What are the time limits for mis-sold PCP claims?

In general, complaints should be made within six years of the event or three years from when you first knew, or ought reasonably to have known, that you had cause to complain. The FCA scheme may put specific timelines around commission-related cases. Send in the complaint so the lender can evaluate it if you're not sure.

I am not sure if my PCP was mis-sold. What should I check first?

Start with the basics. Was the balloon payment and total cost explained clearly? Were mileage limits realistic for you? Did anyone tell you the dealer could adjust the interest rate or that commission was involved? Were you offered realistic alternatives? Did the monthly payment sit within a sensible budget based on your income and bills? If several answers raise concerns, it is worth exploring a mis-sold PCP claim.

Can I claim if my car was repossessed or voluntarily terminated?

Yes. You can still bring a mis-sold car finance claim even if the vehicle was repossessed or you used voluntary termination. The question is whether the agreement was mis-sold, not how it ended.

What costs are usually refunded if a PCP claim succeeds?

Outcomes may vary, but redress often includes a refund of overpaid interest that resulted from undisclosed discretionary commission, repayment of hidden fees, and in some cases an extra amount for distress or inconvenience if the conduct was especially poor. The FCA consultation will clarify the redress formula for scheme cases.

Will the FCA scheme cover all mis-sold PCP claims?

The consultation in October 2025 will set the scope, but the expectation is that it will focus on commission-related mis-selling for agreements entered between 2007 and January 2021 [6], because that is when discretionary commission arrangements were widely used. Keep an eye on the FCA updates when the consultation opens.

Quick checklist before you submit a mis-sold PCP claim

• Find your agreement and any emails or letters from the dealer or lender.
• List what you were told about interest, commission, mileage and balloon payments.
• Note anything that felt rushed or unclear at the time.
• Include payment records if you have them.
• Keep a copy of your complaint and send it to the lender.
• If there is no reply, consider the Financial Ombudsman Service.

Bottom line

If your PCP agreement was not explained properly, if commission shaped your interest rate without your knowledge, or if you were pressured into something that was not affordable, you may have a strong mis-sold PCP claim. With the FCA indicating an average redress of around £950 per agreement, and a formal process expected to kick in during 2026, the smartest move is to get your documents together and submit your complaint so you are ready when the system restarts.

_________

1. in August 2025, the Supreme Court issued a landmark decision - https://supremecourt.uk/uploads/uksc_2024_0157_0158_0159_judgment_2bb00f4f49.pdf
2. Financial Conduct Authority (FCA) has extended its pause on handling commission-related complaints - https://www.fca.org.uk/news/statements/firms-given-until-december-2025-respond-motor-finance-commission-complaints
3. The FCA also said a formal consultation will be released in October 2025 and will take six weeks - https://www.fca.org.uk/news/statements/fca-consult-compensation-scheme-motor-finance-customers
4. FCA has indicated that the average redress for commission-related cases is around £950 per agreement - https://www.fca.org.uk/news/statements/fca-consult-compensation-scheme-motor-finance-customers
5. You can file a mis-sold PCP claim with the Financial Ombudsman Service if necessary - https://www.financial-ombudsman.org.uk/consumers/complaints-can-help/credit-borrowing-money/car-finance/complaints-about-commission
6. mis-selling for agreements entered between 2007 and January 2021 - https://www.which.co.uk/news/article/car-finance-fca-investigation-what-you-need-to-know-a4eXb5u8VeBy