Car finance redress
The FOS process is a free, four-step route: complain to your lender, get their final response, refer it to the ombudsman, then await a decision. The ombudsman reviews both sides and decides what's fair.
Worked example
Keep it factual: "I complained to [lender] on [date] about undisclosed commission on agreement [number]. Their final response on [date] rejected the complaint. I disagree because [I was never told about any commission / the APR looks high for my credit profile / they did not answer whether a DCA applied]." You don't need legal language. Plain English is what the ombudsman expects.
Redress estimate
Any figures here are an estimate, not a promise, and nothing on this page is financial or legal advice. You can claim free yourself — you don't need a claims firm.
The FOS process for car finance complaints is the free, independent route to the Financial Ombudsman Service (FOS) when you and your lender can't agree. You go to the FOS after your lender's final response, or if the lender doesn't reply in time. The steps, timings table and evidence list below show what to do at each stage.
Any figure you see is an estimate, not a promise. Nobody is guaranteed a payout, and the amount depends on your own agreement. You never need a claims firm to use the FOS, and you can estimate your position first with the compensation estimator. The rest of this page covers costs, decisions and what the ombudsman can and can't do.
What is the FOS process?
The FOS process is a free, four-step route: complain to your lender, get their final response, refer it to the ombudsman, then await a decision. The ombudsman reviews both sides and decides what's fair.
The Financial Ombudsman Service is independent of both you and the lender. It was set up by Parliament to resolve financial disputes without anyone needing a lawyer. Its decisions are binding on the lender if you accept them.
Under the FCA's scheme (PS26/3), most disputes are expected to be settled at the lender stage. The ombudsman remains the free backstop for the cases where you and the lender can't agree.
When to use the FOS
Go to the FOS only after you've complained to your lender first. Use it if you're unhappy with the lender's reply, or if they don't respond within their time limit.
- You've sent your lender a complaint (see how to claim).
- The lender has given a final response you disagree with, or hasn't replied within eight weeks.
- You refer the case within six months of that final response (or the eight-week silence).
- You haven't already accepted a full-and-final offer from the lender on the same point.
Lender first, always
How to refer a complaint to the FOS
Referring a complaint to the FOS is free: gather your paperwork, send it to the ombudsman, and let it review your case.
You can refer a complaint to the FOS on its website or by post. You'll need your credit agreement details, the lender's final response letter, and a short explanation of why you disagree. There is no charge.
- Complain to your lender first and wait for their final response (usually up to eight weeks).
- If you're unhappy, gather your credit agreement details and the lender's final response.
- Refer the complaint to the Financial Ombudsman Service online or by post, within six months, for free.
- Co-operate with the ombudsman's review and wait for its decision.
What to write on the FOS form
What a FOS decision means for you
If the ombudsman upholds your complaint, the lender has to pay the redress the scheme allows. If it doesn't, you can reject the decision and keep your right to go to court. Most people accept a favourable decision because, on balance, the scheme's method is already generous.
A decision in your favour is binding on the lender once you accept it. The lender then pays the redress, usually as cash or as a credit to a live agreement. A decision against you is not binding on you. You can walk away and keep your ordinary legal options, including the courts, although that route is rarely worth the cost for an individual car finance claim.
Either way, the ombudsman works within the FCA scheme's redress method and caps. It cannot award extra compensation beyond those rules, and it cannot fine the lender. Fines are a separate matter for the FCA.
You can accept or walk away
What it costs
Using the Financial Ombudsman Service is free for you. There's no charge to refer a complaint or for the ombudsman to decide it.
A claims firm can't get you a better hearing. The FOS deals with you directly, and the questions on its form are the same whether you or a CMC fill them in. A CMC can take up to about 36% of any payout for doing what you can do free. You do not need a claims-management company taking a cut.
Free, and binding on the lender
How long the FOS takes
Expect the ombudsman to take several months to reach a decision, depending on volume. The car finance scheme is the largest in FOS history, so wait times may be longer than usual.
The FOS will acknowledge your referral, may ask for more information, and then assign a case handler. The scheme has faced a legal challenge since 1 May 2026, and parts of it have been suspended since 29 June 2026, with the hearing listed for 16 February to 3 March 2027. Until that ends, lenders do not need to calculate or pay scheme compensation, which may also affect the volume and pace of cases. Treat any promise of an exact timescale with caution. The service is free, and the outcome matters more than the speed.
| Stage | What happens | Rough timing |
|---|---|---|
| Acknowledgement | FOS confirms it has your referral and gives a reference number. | A few days |
| Initial review | A case handler checks your paperwork and may ask for more. | Weeks to a few months |
| Investigation | The handler reviews both sides and may contact the lender. | Several months |
| Provisional decision | A tentative view, sent to both sides for comment. | After investigation |
| Final decision | Binding on the lender if you accept it. | After any comments |
Timings are estimates, not promises
How often complaints are upheld
A meaningful share of car finance complaints that reach the ombudsman are upheld in the consumer's favour. A lender rejection is not the end. It opens the way to this stage.
Historically, the Financial Ombudsman has upheld a substantial proportion of the motor finance complaints referred to it. The exact rate moves year to year, and the 2026 scheme is expected to resolve most cases at the lender stage, leaving only genuine disputes for the ombudsman. On balance, if your lender rejects a clear case, referring it is well worth doing.
The ombudsman decides each case on its own facts, so past uphold rates are not a prediction of your outcome. Any figure you see is an estimate, not a promise. Nobody is guaranteed a payout, and the amount depends on your own agreement.
Your right to a free, independent review
Check eligibility first
Before you reach the ombudsman, you'll complain to your lender, so start by checking your position.
Check your possible redress, then follow the full how to claim steps. Any figure you see is an estimate, not a promise. Nobody is guaranteed a payout, and the amount depends on your own agreement.
What evidence helps your case
The stronger your paperwork, the smoother the ombudsman's review. Gather what you can before you refer.
You don't need a legal argument. A clear, factual account of what you were (and weren't) told is enough. The ombudsman is used to dealing with consumers directly, not lawyers.
- Your original finance agreement (or a copy the lender resent).
- The lender's final response letter, including the date.
- Any statements showing the APR and payments.
- A short note of why you think the commission was not disclosed.
What the ombudsman can and can't do
The FOS can order the lender to pay redress, but it can't redesign the FCA scheme or punish the lender. Its job is to decide what's fair in your individual case.
If the ombudsman finds your agreement was affected by undisclosed commission, it can direct the lender to put things right under the scheme's redress method. It cannot award extra compensation beyond the scheme's rules, and it cannot fine the lender. That's the FCA's role.
Decisions are binding on the lender if you accept. If you don't accept, you keep your right to go to court instead, though most people accept a favourable decision because the scheme's method is already generous.
If the ombudsman is overwhelmed
Because car finance is the largest complaint wave in FOS history, the service has scaled up, but wait times may be long. This doesn't change your right to use it.
The FOS has added staff to handle motor finance volume, and the scheme is designed to settle most cases at the lender stage so only genuine disputes reach the ombudsman. If your case is taking time, that reflects volume, not a problem with your claim. Keep your reference number and respond promptly to any requests for information.
Frequently asked
What is the FOS process for car finance complaints?
When can I go to the Financial Ombudsman Service?
Does the FOS cost anything?
Is the ombudsman's decision binding?
How long does the FOS take?
Do I need a lawyer or a claims firm for the FOS?
What if I miss the six-month FOS window?
Can the ombudsman award more than the scheme cap?
Sources
We cite regulators and official UK sources only.
- Financial Conduct Authority — motor finance redress schemefca.org.uk
- UK Supreme Courtsupremecourt.uk
- Consumer Credit Act 1974legislation.gov.uk
- Financial Ombudsman Servicefinancial-ombudsman.org.uk
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