Managing your finance
Start by complaining directly to your lender in writing, clearly stating the problem and the outcome you want. The lender must investigate and respond.
Worked example
If your agreement included £1,200 of undisclosed commission, you paid 9.9% APR over four years and the agreement qualifies for the scheme, the FCA scheme would usually pay the average of that £1,200 and your estimated overpayment (based on a 17% discount to your interest rate for agreements from April 2014, or 21% for earlier ones), plus interest. Only the most serious cases get the full £1,200 back plus interest. The FCA expects an average of ~£829 per agreement, and until the legal process ends lenders do not need to calculate or pay compensation. The exact figure depends on the agreement, which is why the estimator gives a range, not a fixed number.
To complain about your car finance, write to your lender first, setting out what went wrong and what you want fixed; if they don't resolve it within eight weeks, you can escalate free to the Financial Ombudsman Service. Complaining is always free.
The same route works for poor service, unfair charges, mishandled payments and mis-selling. You never need to pay a claims firm to complain on your behalf, and you keep 100% of any redress by doing it yourself. The steps below run from first letter to Ombudsman, and the tables cover complaint types and redress.
How do you complain about car finance?
Start by complaining directly to your lender in writing, clearly stating the problem and the outcome you want. The lender must investigate and respond.
Most complaints are resolved at this stage. If yours is about hidden commission or mis-selling, see how to claim compensation yourself and the free letter template. For most complaints the lender has up to eight weeks to send a final response; commission complaints covered by the FCA's redress scheme follow the scheme's own timings instead. If the lender doesn't respond in time, or you're unhappy with its response, you take the complaint to the Ombudsman.
You start with the lender because the Financial Ombudsman won't usually look at a complaint until the lender has had a fair chance to fix it. Skip that step and the Ombudsman will send you back. Keep dated copies of everything you send and receive, so you can show what happened and when.
How to make a complaint, step by step
Put your complaint in writing, give the lender a chance to respond, then escalate if needed. Follow these steps.
Be specific. State the facts (dates, amounts, what was said), the impact on you, and the outcome you want: a refund, an apology, a charge reversed or compensation. Vague complaints get slower, weaker responses. If you have evidence (statements, the credit agreement, screenshots), attach copies.
You can complain by letter, email, online form or phone, but a written record is strongest. If you call, follow up in writing so there's a paper trail.
- Write to your lender: explain what went wrong, with dates, and what you want.
- Keep copies of everything, including emails, letters and call notes.
- Give the lender up to eight weeks to send a final response.
- If you're unhappy with the response, or get none, take it to the Financial Ombudsman Service.
- Submit your complaint to the Ombudsman within six months of the lender's final response.
Escalating to the Financial Ombudsman
The Financial Ombudsman Service settles complaints between you and your lender for free, and its decisions are binding on the lender. You can use it once the lender has had its chance to respond.
The Ombudsman is independent and doesn't take a cut of any award. You have six months from the lender's final response to bring your complaint. Miss that window and the Ombudsman usually can't help. You don't need a claims-management company, and you keep 100% of anything you're owed.
To escalate, fill in the Ombudsman's online form or call them. They'll ask for your complaint details, the lender's response, and any evidence. The Ombudsman's decision is binding on the lender if you accept it, but you're not bound by it. You can still go to court if you disagree, though most people accept.
It's free to complain
What you can complain about
Any failure by the lender to treat you fairly is grounds for a complaint. The most common categories are below.
If your complaint is about hidden commission or mis-selling, you may be owed money back under the FCA's motor finance redress scheme, though parts of it are suspended until a legal challenge is resolved; the scandal explained sets out the background. You can estimate your position with the compensation estimator. Its result is an estimate, not a promise, and you can claim free yourself.
| Complaint type | Example | Possible redress |
|---|---|---|
| Unfair charges | Fees added without clear notice | Refund of the charge |
| Poor service | Settlement figure delayed or wrong | Apology + correction |
| Mishandled payments | Payments misapplied or arrears mismanaged | Correction + compensation |
| Mis-selling / hidden commission | Commission not disclosed (DCA) | Compensation / interest refund |
| Affordability failure | Lent to you when you couldn't afford it | Refund + interest removed |
Complaining about mis-sold finance
If your complaint is about hidden commission or a mis-sold agreement, the same free route applies: lender first, then the Ombudsman. You may be owed redress.
The car finance mis-selling scandal is covered in the scandal explained. After the Supreme Court ruling in August 2025, the FCA made a redress scheme, but parts of it have been suspended since 29 June 2026 while a legal challenge goes through, with a hearing listed for 16 February to 3 March 2027. Until the legal process ends, lenders do not need to calculate or pay compensation, and payouts are expected in 2027 at the earliest, if the scheme is upheld and the judgment is not appealed. If your agreement was affected, the same free process applies: complain to the lender, then go to the Ombudsman if you are unhappy with the answer. The scheme sets its own response timings rather than the usual eight weeks.
Use our free letter template to write to your lender. The letter sets out the unfair-relationship argument under section 140A of the Consumer Credit Act 1974 and asks for redress. Don't pay a claims firm to send the same letter you can send yourself.
Claims firms — what they cost you
Claims-management companies charge a sizeable slice of any award for a process you can run yourself for free. Using one is optional.
The FCA warns that claims firms and law firms can take fees of up to 36% including VAT out of any motor finance compensation. On a £1,000 award, that's up to £360 gone. The complaint process is the same whether you or they submit it: the lender first, then the Ombudsman. Our view: a claims firm brings no advantage that justifies that cut, because the steps and the decision-makers are identical, and there is no 'deadline' you need them to beat: if your lender has not contacted you, you can still complain yourself by 31 August 2027 under the scheme rules as made, which may change after the legal challenge.
If you're already signed up with a claims firm, you usually have a 14-day cooling-off period to cancel. Check the contract, cancel in writing if you want to, and run the complaint yourself using our free letter template.
Beware 'no win, no fee' claims firms
How long a complaint takes
Expect up to eight weeks for the lender's final response, then several months if it goes to the Ombudsman. Commission complaints covered by the FCA's redress scheme run on the scheme's own, currently uncertain, timetable.
FCA rules give the lender up to eight weeks for most complaints. The Ombudsman's timeline depends on complexity and caseload. Straightforward cases can resolve in a few months, while for commission complaints under the FCA's redress scheme the timing of the lender's response is uncertain because parts of the scheme are suspended. You can check progress through the Ombudsman's online portal once your case is open.
What redress could you get?
Redress for an upheld complaint is usually a cash refund of the unfair charge plus interest, or, for hidden commission under the FCA scheme, compensation worked out by the scheme's rules plus interest. The Ombudsman sets the standard calculation for most complaints, and the FCA sets it for the scheme.
The Ombudsman adds interest for the time you were out of pocket: for complaints referred to it from 1 January 2026 it typically uses a time-weighted average of the Bank of England base rate plus one percentage point, and 8% simple a year for earlier cases. It applies from the date the money was wrongly taken until the date it's repaid. On a commission claim under the FCA scheme the calculation is different: most people get the average of their estimated overpayment and the commission paid, plus simple interest at the annual average Bank of England base rate plus 1%, with a 3% minimum in any year, and only the most serious cases get all the commission back. Use the compensation estimator to gauge your position before you complain. Its result is an estimate, not a promise, and the lender or the Ombudsman sets the final figure.
If the lender's final offer is a lower figure than you expected, you don't have to accept it. Reject it in writing and escalate to the Ombudsman, who looks at the case afresh rather than simply accepting the lender's offer. For a commission complaint under the FCA scheme, the Ombudsman checks that the scheme rules were followed, and you need to contact it by the date given in your lender's letter.
| Complaint | What you may get back | How it's calculated |
|---|---|---|
| Unfair charge | The charge refunded | Full amount of the charge, plus interest |
| Hidden commission (DCA) | Compensation, if owed | Usually the average of your estimated loss and the commission, plus interest |
| Affordability failure | Interest removed | Loan restructured to remove interest and charges |
| Mishandled payments | Compensation | Direct loss plus a goodwill payment for distress |
Worked example: a hidden-commission payout
What good evidence looks like
A strong complaint names the dates, amounts and people involved, and attaches the documents that prove it. Vague complaints fail more often than specific ones.
Before you write, gather: a copy of the original finance agreement, your payment history (statements or a printout from the lender's portal), any correspondence about the issue (letters, emails, call notes with dates and times), and the settlement figure if your complaint is about early settlement. If you're claiming hidden commission, your lender must hand over the commission details on request. Under UK GDPR you can make a Subject Access Request, usually free, and the lender has one month to respond.
Set your complaint out in numbered points: what happened, when, who was involved, what the impact was, and what you want done about it. Reference the rule you think was broken, for example FCA CONC rules on affordability, or section 140A of the Consumer Credit Act 1974 for an unfair-relationship claim. Lenders and the Ombudsman both respond faster and more fully to complaints that are specific and evidenced.
Keep a dated paper trail
Frequently asked
How do you complain about car finance?
Is it free to complain about car finance?
How long does a car finance complaint take?
What can you complain about with car finance?
Do you need a claims firm to complain?
What happens if the lender ignores your complaint?
How much compensation could I get for a car finance complaint?
Do I have to accept the lender's first offer?
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