Were You Mis-Sold Black Horse Car Finance?

Were you mis-sold Black Horse car finance?

A Black Horse agreement may have been mis-sold if, between 6 April 2007 and 1 November 2024, the dealer or broker who arranged it was paid commission that pushed up your interest rate and you weren't told. The problem runs across the whole dealer-arranged market, not just Black Horse, and the FCA is dealing with it across every lender at once.

The test is identical whichever lender you used. What counts is whether your APR was pushed up so the dealer or broker earned more commission, and whether anyone told you that had happened. The Black Horse name on the credit agreement doesn't change that. Black Horse is a bank-owned motor finance provider, which is useful background, but the rules bite the same way whoever the lender is.

Black Horse in context

Black Horse is a long-established UK motor finance brand and part of Lloyds Banking Group. It has historically been one of the larger providers of dealer-arranged car finance, lending on new and used cars mainly through franchised dealers, on both PCP and HP.

Because Black Horse lends largely through dealers rather than direct to consumers, the scheme looks at the commission a dealer or broker was paid for arranging your agreement, not at who owns the lender. Dealer-introduced finance is the route through which discretionary commission arrangements used to operate.

Bank ownership gives a lender no special status under the scheme. Every agreement is judged by the same three-part test: an undisclosed DCA, an undisclosed high-commission arrangement, or an undisclosed contractual tie.

How the commission issue affects Black Horse agreements

The commission problem ran right across dealer-arranged car finance. Black Horse agreements get the same assessment as any other lender's.

The FCA banned discretionary commission arrangements (DCAs) on 28 January 2021 after finding the practice across the dealer-arranged market. Then on 1 August 2025, the Supreme Court ruled that undisclosed commission like this can make the lending relationship unfair, applying the unfair-relationship test (s140A, Consumer Credit Act 1974). That cleared the FCA to confirm a redress scheme (PS26/3). Parts of it were then suspended from 29 June 2026 after legal challenges, with the hearing listed for 16 February to 3 March 2027, and payouts are expected in 2027 at the earliest, if the scheme is upheld and the judgment is not appealed.

So this isn't about Black Horse in particular. If your Black Horse agreement carried undisclosed commission, you can complain under the same scheme as anybody else. The detail sits in what a DCA is, the ruling, and how the FCA scheme works.

Were you affected? A checklist

Check the date, the route and the disclosure on your Black Horse deal. The more of these that fit, the stronger a free complaint looks.

If most of these fit, a free complaint is worth sending even if you're not certain. The lender has to check its own records and tell you whether a qualifying commission applied, though the FCA says the timing is uncertain while parts of the scheme are suspended. The free letter template does the asking for you.

Black Horse agreements like this are usually PCP car finance. It's worth modelling yours on the free calculator to see what a fair monthly payment looks like, alongside any redress figure the scheme works out.

• Your Black Horse finance began between 6 April 2007 and 1 November 2024.
• It was set up through a dealer or broker who was paid commission for arranging it.
• Your interest rate may have been pushed up so that dealer or broker earned more (a DCA).
• The commission wasn't properly disclosed to you, in a way the FCA would accept.
• It is not a 0% or minimal-commission deal (those are generally left out).

How much could a Black Horse claim be worth?

Redress pays back the interest you overpaid because of the commission, plus interest on top for the time you were out of pocket. That's why it varies so much from deal to deal. The FCA puts the scheme average at ~£829 per agreement, and roughly one in three qualifying agreements hits a cap.

Two Black Horse customers with different cars, rates and terms can end up owed very different amounts. A bigger, longer, higher-rate agreement tends to rack up more overpaid interest than a small, short, low-rate one. Any figure you see is an estimate, not a promise. Nobody is guaranteed a payout, and the amount depends on your own agreement.

How to claim against Black Horse for free

You can do this yourself, for free, in two stages: complain to Black Horse first, then go to the Financial Ombudsman Service if you disagree with the answer. You don't need a claims-management company.

Claiming is free and you can do it yourself: complain to your lender first, then escalate to the Financial Ombudsman Service. You do not need a claims-management company taking a cut. A claims firm can take up to about 36% of any payout for filing the same free complaint you could send yourself.

1. Pull together your Black Horse agreement details: the lender name, the start date, the agreement number and the APR.
2. Write to Black Horse with the free letter template and ask whether a DCA, a high-commission arrangement or a contractual tie applied, and how much commission was paid.
3. Wait for the lender's answer. The FCA says the timing is uncertain while parts of the scheme are suspended, and until the legal process ends lenders don't have to work out or pay compensation.
4. If you're unhappy with the answer, take it free to the Financial Ombudsman Service by the date given in the lender's letter, or the ombudsman may not be able to help.