Latest news with #carfinance
The Sun
a day ago
- Automotive
- The Sun
British boxer Tyson Fury has partnered with claims management company My Claims Group to raise awareness and help drivers claim compensation for mis-sold car finance.
Between April 2007 and January 2021, car dealerships and finance providers could charge their customers hidden commission on their agreements. This made the finance arrangement more expensive for the driver. 1 The practice was eventually banned after 2021, but a legal case has ensued to award affected drivers compensation. A ruling is expected from the Supreme Court later this month, and the Financial Conduct Authority (FCA), the industry watchdog, has already made plans for a redress scheme. The Lloyds Banking group, which owns brands like Halifax and Black Horse, has already set aside money it expects to owe in compensation – and other lenders have followed suit. My Claims Group believes those affected could be owed up to £4,000** in compensation for mis-sold car finance agreements. So far, millions of drivers have signed up with the firm to help manage their case. Why use My Claim Group My Claim Group is one of the largest HP/PCP claims companies in the UK authorised and regulated by the Financial Conduct Authority. Some benefits of working with My Claim Group include: No win, no fee*** – My claim Group's panel of solicitors operate on a No Win No fee basis. If they do not win, you do not pay anything. Clients have a 14 day "Cooling-Off" period during which time they may cancel at any time without charge. Successful claims made through any of My Claim Group's panels are subject to a Success Fee. Fee's range from 18% to a maximum of 36% inclusive of VAT dependant of level of redress Simple claim process - My Claim Group's claim process is relatively simple and user-friendly. If claimants do not have the necessary information for a claim, then the My Claim Group's team will also gather these details together on their behalf, including requesting and processing documentation from car dealers. Who is Tyson Fury? Fury, also known as "The Gypsy King" fights in the heavyweight division. He is a two-time world heavyweight champion, holding the unified WBA, IBF, WBO, and IBO titles in 2015 after defeating Wladimir Klitschko, and later the WBC heavyweight title from 2020, which he won by defeating Deontay Wilder. Earlier this month, he became an ambassador for My Claims Group and has urged drivers to check if they are eligible for compensation. Claims can be made without professional representation There is no need for a claim to be referred to a CMC or legal representation. They can do this themselves for free either to their lender and then onto the financial ombudsmen service. However, working with a company like My Claim Group will allow you access to expert support and experience of their team. Also if you don't know your vehicle finance information they can find it for you. If you think you might have a claim in relation to your car finance, then don't miss out on the compensation you could be entitled to. My Claim Group is a trading name of the Claims Protection Agency Ltd, authorised and regulated by the Financial Conduct Authority (FCA No. 836470). *My Claim Group will undertake a free check at no cost to you on your behalf to assess if you may have a vehicle finance claim. **See link for the FCA reference, solicitor fee tables & average valuations: *** If you proceed, our panel solicitors work on a no win, no fee basis (subject to exclusions, for full details click on: Solicitor fees are up to 36% inc VAT. We receive a fee after a successful payout or a referral fee from your solicitor and this does not affect the compensation you will receive. You do not need to use a claims management company to make a claim; you can do this yourself for free by contacting the car dealership or finance provider and if that is not successful you can complain to the Financial Ombudsman Service.
Yahoo
3 days ago
- Automotive
- Yahoo
'I have little sympathy for the lenders - where was the car finance value for consumers?'
Even as a child, if Aidan Rushby witnessed bullying at school the now entrepreneur's modus operandi was to come to the rescue. Fast forward several years to where Rushby set up car finance app Carmoola to help consumers and get rid the "horrendous" commissions which could see millions owed compensation following the motor loan mis-selling scandal. 'There is something about serving and helping people,' says Rushby, co-founder and CEO of the fintech start-up. It's about delivering value for consumers so they can get a great product and ultimately you can drive a great business. I love seeing customers' reactions to the product.' Read More: I ditched waking up before 5am every day to grow my luxury bedding brand Rushby knew he was on to something when his mother-in-law understood the concept of Carmoula when he pitched it to her, ahead of launching the company in late 2022. Carmoola has since processed around four million loan applications in the three years since the app first came to market — and acquired total funding to the tune of £146m. Before car financing came car washing when he set up his first business as a 15-year-old. He later set up his own motor racing team, made websites at university selling T-shirts before working in property and 'being out and about' in Bristol. In 2013, Rushby started to think about digitising the rental experience and set up his first business venture, Movebubble, which lasted seven years. 'It was painful and I made so many mistakes,' he admits. 'I had a fair amount of childhood trauma and I was in this loop of failing. I was quite persistent and kept on trying to raise money to keep it going. 'It's not a great place as an entrepreneur to fear failure as you really need to embrace it. I wasn't scared of taking risks, I was more scared of how others would perceive it if it didn't work.' Rushby, who has dyslexia, stepped away as CEO in 2021 and sensed an opportunity in the car finance market after mulling consumer business ideas in the mortgage and investment space. He tested demand with a basic landing page website under a different brand name. Within a few hours, there were hundreds of sign ups for the product offering and it gave Rushby confidence to drive the business forwards. 'I saw that consumers were being ripped off by all these traditional lenders where they were paying the dealerships massive commissions and raking up the APRs,' he says. 'I thought there was a big opportunity to go direct to the consumer and deliver a modern fintech product experience.' Read More: 'In our workplace, we look for passionate, slightly unhinged mountain climbers' There were still stumbling blocks ahead of launch as investors began to ask questions after regulatory approval took six months longer than expected. Carmoola received the green light in the same week that Russia's invasion of Ukraine escalated. With two of Rushby's co-founders and engineers hailing from Ukraine, there was a frantic move to make the border crossing to Poland before it closed a few hours later. Of Carmoola's 50 staff, half are engineers now based in Warsaw and the rest housed at the firm's Primrose Hill headquarters in London. A revenue run rate is closing in on £20m, with Carmoola growing at 150% year-on-year. Its customer support team is employed directly and based in the UK, with Rushby noting that salaries are paid above market average in a bid to be pivotal, on-hand support to its customers. 'Consumers are trusting Carmoola with a very big purchase, probably the most important purchase after their home,' he says. 'It's an incredibly stressful time for those people who can't pay their car loan. They need professionals who can help them on that journey during periods if they lose their job or something happens in the family.' Rushby is also eyeing the looming Supreme Court ruling which could see payouts for millions of drivers after dealerships increased commission without being disclosed to consumers. The Financial Conduct Authority could then set up a redress scheme for lenders to compensate consumers, while payouts could take up from six months up to one year. 'It was one reason why Carmoola was created, to get rid of the horrendous commissions,' says Rushby. 'These people [lenders] were well aware of what they were doing in terms of ripping the consumer off. I have little sympathy. The traditional process was so opaque and they were acting for their own pockets. Where was the delivery of value to the consumer?' Read More: 'I returned to my old office to sell ties after being made redundant' Carmoola's next port of call is to build out financial products centred around the vehicle by launching a leasing-style PCP product as well as car insurance. New markets' expansion outside of the UK will also be explored. One senses that with the plentiful hurdles that Rushby has overcome during his career, both privately and in business, the entrepreneur relishes opportunities to solve them. Sure enough, as a founder he admits this to being 'super fun'. 'The more scary it is, the better sometimes,' he adds. 'It's a fun intellectual challenge of how to fix these things.' View from the top: how to build a successful start-up Go with your own gut Don't look for other people to give you advice. You have to make the decisions and they come from listening to other people. Very few people have the context that you are trying to solve, so you have to form your own judgement and be disciplined as an entrepreneur. Writing a journal is powerful I write a CEO report outlining what we are doing at strategic and operational levels. It's a powerful tool to look back over time in how I was thinking at the time and whether it played out. Show value proposition To show real understanding, are you able to communicate that to somebody who has no idea? Do they get it and does it make sense to them? I pitched Carmoola to my mother-in-law and she got it straight away. I wouldn't say that is the golden rule but it is a useful way of articulating whether the business model makes sense. A step by step process This gave me a high level of confidence to make sure it would work after the lessons from my first business. What is the real size of the market? How is revenue generated and how many people are likely to use the product? How cost effective is it to acquire the customers in this space? Then it's how to generate revenue and what the unit economics look like for the product. I forecast all of that before we even started. The real thinking From here, it is whether you are confident in acquiring these customers, what the competition is going to do and if they can stop you; to how much time you have got to really make it fly and the key elements of what you need to deliver on so that they can't copy you. Read more: 'I returned to my old office to sell ties after being made redundant' 'In our workplace, we look for passionate, slightly unhinged mountain climbers' Britain's 'king of billboards' who sold his business for £1bn
The Sun
15-07-2025
- Automotive
- The Sun
Mis-sold car finance average payout: how much could you get?
LATER this month the UK supreme court is expected to rule on whether car finance dealers unlawfully charged millions of drivers secret commission. This means if you took out a car finance arrangement before 2021 you could be in line for compensation. In the build up to the ruling, the Financial Conduct Authority (FCA), the industry watchdog, is reviewing how it would implement a large-scale redress scheme. Lloyds Bank, meanwhile, have set aside £1.2 billion in potential compensation costs – with other lenders following suit. CHECK HERE What are mis-sold car finance claims? Most cars in the UK are bought on a finance agreement, like a Hire Purchase (HP) or Personal Contract Purchase (PCP) agreement. Before being outlawed in 2021, these agreements could be sold with 'discretionary commission'. This meant your finance provider was allowed to increase your interest rate and pocket the difference as commission. Drivers didn't know that they could have paid for a cheaper loan and that part of their monthly repayments were funding this commission structure. What is the average payout for mis-sold car finance? Until the matter is resolved in court, the exact compensation drivers can expect remains unclear. However, we do know the average driver could be due thousands. My Claim Group, a claims management company, estimates that the average driver could receive up to £4,000**. Separate information from the FCA also found that a £10,000 finance agreement on PCP or HP could have cost the average consumer £1,100 in additional interest charges. This information will likely play a role in calculating the compensation you will receive, alongside a few other factors. What factors could affect my car finance mis-selling payout? A few individual factors will likely influence your car finance payout. This includes: The interest rate you received The discretionary interest charged might differ depending on your lender. A higher rate means you may have paid more in commission to your dealer, and this could mean you're due an increased payout. The length of the agreement When purchasing on finance, the length of the repayment period affects borrowing costs. Longer repayment periods typically mean lower monthly payments but higher overall borrowing costs. Shorter repayment periods, on the other hand, result in higher monthly payments but lower total costs. So, repayment plans can influence the total interest paid on your finance. A longer repayment period at a higher rate could mean you paid more in unfair commission. The size of the loan In addition to the length of the agreement, the size of the loan also plays a role in determining the total interest paid. A larger loan charged at a higher rate means you could have paid more in discretionary commission. Can I make multiple claims to increase my payout? Discretionary commission arrangements were commonly used before their ban in 2021. During this time, drivers may have entered into multiple finance agreements, each with its own hidden commission. This means you might be eligible to make multiple claims and receive multiple payouts. CHECK HERE How to apply for compensation You do not need to use a claims management company to make a complaint, you can do it directly via your lender and eventually the Financial Ombudsmen Service. My Claim Group work with a panel of solicitors and they work on a no win no fee***. This does mean if it's successful then they will take a cut of your total payout but you don't have to deal with the administrative hassle of claiming. The Law Firms they work with take between 18 % and 36% inc VAT of successful claims. The total amount you would be due to pay depends on the level of redress you have received. My Claim Group is a trading name of the Claims Protection Agency Ltd, authorised and regulated by the Financial Conduct Authority (FCA No. 836470). *My Claim Group will undertake a free check at no cost to you on your behalf to assess if you may have a vehicle finance claim. **See link for the FCA reference, solicitor fee tables & average valuations: *** If you proceed, our panel solicitors work on a no win, no fee basis (subject to exclusions, for full details click on: Solicitor fees are up to 36% inc VAT. We receive a fee after a successful payout or a referral fee from your solicitor and this does not affect the compensation you will receive. You do not need to use a claims management company to make a claim; you can do this yourself for free by contacting the car dealership or finance provider and if that is not successful you can complain to the Financial Ombudsman Service.
The Sun
14-07-2025
- Automotive
- The Sun
Key mistake that could see you lose up to 36% in car finance misselling scandal compensation
MOTORISTS affected by the car finance mis-selling scandal have been issued a warning over a simple mistake that could prove costly. Impacted drivers should avoid using claims management companies (CMC) or law firms to get compensation, the regulator has said. 1 Over 23million people believe they could be owed money due to mis-sold car car finance loans, according to recent research. However, the Financial Conduct Authority (FCA) has cautioned anyone using a CMC or law firm could lose a hefty amount of any payout in fees. The FCA said: " Consumers should be aware that by signing up now with a CMC or law firm, they may end up paying for a service they do not need and losing up to 30% of any money they may receive." The amount of compensation swallowed in fees can be worth up to 36% too, as claims companies can charge additional VAT. The amounts of compensation affected drivers will receive are yet to be confirmed, but someone in line for a £1,000 compensation would see £360 paid out in fees. The FCA is currently waiting for the outcome of a Supreme Court ruling before deciding whether a mass redress scheme for affected drivers will go ahead. It said in June it will confirm within six weeks of that ruling whether a scheme will go ahead. The regulator also laid out how a possible scheme would look and when any compensation could be paid, estimated to be in 2026. What is the car finance mis-selling scandal? The Car Finance Discretionary Commission Scandal affects those who bought a car, motorbike or van on finance before January 28, 2021. After this date, the FCA banned lenders from using "Discretionary Commission Arrangements" (DCAs). DCAs allowed brokers to increase interest rates on car finance loans, which in turn saw their commission bumped up. It has been classed as an unfair practice because drivers weren't told about the DCAs and therefore thought any deals were a fixed price they couldn't negotiate on. But, anyone who took out a vehicle on finance before January 28, 2021, could have been paying more than they should have. The FCA estimates around 40% of car deals bought on finance before 2021 could be affected. Lloyds Banking Group has set aside £700million for potential compensation relating to the scandal. Barclays has allocated £90million, while Santander said last year it had earmarked £295 million for potential payouts. The Royal Bank of Canada has estimated that the industry's bill for motor finance compensation could stretch to £13billion while Which? estimates it could cost them up to £16billion. What could the compensation scheme look like? Lucy Andrews, deputy consumer editor at The Sun, explains what you need to know. The FCA is mulling over what a redress scheme would look like if the Supreme Court rules that drivers should be compensated. The watchdog will set out rules for how claims will be assessed and calculated. There are two main options for a redress scheme: an opt in, or opt out structure. Under an opt-in scheme, you would have to sign up and confirm you want to be included within a certain time limit. An opt-out scheme would mean that customers are automatically signed up. How to find out if you're affected and next steps The website has a tool you can use to find out if you might be in line for compensation. You can find it via It also lets you draft a letter to submit a complaint to the lender or broker who sold you a car finance deal ahead of any Supreme Court ruling. You can also do this yourself. Sarah Coles, personal finance expert at Hargreaves Lansdown, said: "Say (in the letter) why you want to complain, and include as much information as you can. "They should acknowledge your letter within eight weeks, but they don't have to send you a final answer until after December 4 this year – because things have been put on hold while the legal cases rumble on." If you're not happy with your firm's response, you can complain the Financial Ombudsman Service (FOS). Contact details for the FOS can be found via However, it might be worth waiting until the FCA has laid out its next steps for a redress scheme. This is particularly important as some CMCs and law firms have advertised highly speculative figures for how much drivers could be owed in compensation. The FCA has said it will make any scheme easy to take part in without the need for a CMC or law firm. .
The Guardian
12-07-2025
- Automotive
- The Guardian
Car finance: Drivers using claims firms could face 36% add-on charge on compensation payouts
Adverts claiming consumers could be entitled to compensation for mis-sold car finance are popping up everywhere. 'You could be owed thousands … File your car finance claim today' is a typical call to action. With only weeks to go, however, until we find out whether there could be payouts for millions of people, there are warnings that signing up with a claims management company (CMC) could be a bad idea. The payment protection insurance (PPI) debacle led to claims firms pocketing billions of pounds of the compensation paid to victims, and it seems some are keen to cash in on this latest consumer issue. It has been said the scandal could result in a £44bn bill for lenders, and this week a survey revealed that more than 23 million people believe they could be due some compensation for a mis-sold car loan. However, the main UK regulator, the Financial Conduct Authority (FCA), told Guardian Money: 'Consumers should be aware that by signing up now with a CMC or law firm, they may end up paying for a service they do not need and losing up to 30% of any money they may receive.' The amount that can be swallowed up in fees is actually up to 36%, as claims companies can charge VAT on top of a percentage cap applied by the FCA. As we explain later, there is a mechanism that allows some law firms to charge even more. Here we recap the story so far and run through your options. This is all about the alleged large-scale mis-selling of car loans involving the payment of secret commissions to car dealers and – it would appear – millions of car buyers unknowingly paying more for their finance than they should have. Across the UK, an estimated 80% to 90% of new cars, and an increasing number of used vehicles, are bought with motor finance, by which we typically mean personal contract purchase plans and hire purchase agreements. Everyone is anxiously awaiting a ruling from the supreme court that is expected some time this month. The FCA has said that if, after the judgment, it concludes that consumers have lost out, it is likely it will consult on an industry-wide consumer compensation scheme. In broad terms, the people who appear to have the best chance of getting compensation are those who used car finance to buy a new or secondhand motor vehicle – for example, a car, van or motorbike – before 28 January 2021 (and, we think, after April 2007), where the finance included something known as a discretionary commission arrangement (DCA). However, a court of appeal ruling last autumn sent shock waves through the sector as it suggested anyone with any type of car finance that included commission that was not properly disclosed could be owed money. So it is possible the FCA could set the scope of any scheme to include other types of car finance where people were not given all the necessary information. It has previously indicated that for a typical £10,000, four-year car finance deal where a DCA was used, a customer might have paid £1,100 too much interest. However, there could be a requirement for firms to pay interest on top of that, which could add up to a lot if it is several years' worth. If you think you are affected you could do one of the following. This is the easiest option, and we shouldn't have long to wait before we get a lot more clarity. The FCA says it will confirm within six weeks of the supreme court judgment whether it is proposing to launch a compensation scheme. If so, it will carry out a consultation before making its final decision, with any scheme likely to commence next year. The FCA says it will aim to make any scheme 'easy to take part in, without needing to use a CMC or law firm'. It has been suggested that if a scheme does go ahead, banks and other lenders will have to proactively contact all their customers who meet the mis-selling criteria and offer them compensation. Martin Lewis, the founder of says that would mean 'people won't need to complain – they will be paid out an amount dictated by the FCA to firms based on their situation'. Of course we will need to wait to see what happens. Let's first talk about the people whose car finance included a DCA: some would say that logging a complaint now means you are 'in the system'. It gives the company concerned a chance to track down your information, and you can point out things that may help with that. If there is a problem – for example, the firm says it has mislaid or deleted your data – it is probably better to know now rather than later. 'Submitting a complaint could be helpful if you've changed your contact details or moved house since taking out your car finance, as the information you provide will help the providers match you with your car finance agreement,' the MoneySavingExpert website says. It adds that logging a complaint now could help reduce the risk of being ruled out if a time limit is imposed in future. It has a free tool on its website that it says can help people check if they had a DCA and, if they did, get their complaint logged. You have to answer a few questions on the details of your car finance, then it creates an email for you to send to the relevant lender. Or you can complain yourself. It is free and simple, the FCA says. You will need to complain to the company you were paying each month, and ideally do it in writing. If you don't get a response or your complaint is rejected, you can take it to the free Financial Ombudsman Service. Official websites such as the government-backed MoneyHelper have guides to how to do this. In terms of non-DCA car finance complaints, things are now a lot less clear. However, you can still put in a complaint now if you believe you were not told about commission and may have paid too much for your finance. Much of the previous advice applies to these people, too, although for non-DCA complaints the end date is looking like October 2024. MoneySavingExpert has a different free tool for these people that could be useful to you. The FCA has given companies until after 4 December this year before they have to start responding to any type of car finance commission complaint, so you may not hear anything substantial for a while. However, your provider should send you an acknowledgment within eight weeks. The Financial Ombudsman Service has about 100,000 motor finance commission cases lodged with it, with the legal proceedings affecting its ability to issue final decisions in these cases. It is a busy time for companies offering to help people make a claim for car finance compensation, usually on a 'no win, no fee' basis. There are lots jostling for our attention, from one-man-band operations to high-profile consumer law firms. Many of the adverts talk of sizeable potential refunds. However, as highlighted previously, the FCA has made its views very clear on this potential route to compensation. It adds: 'We've seen law firms and CMCs touting highly speculative figures to sign people up for motor finance claims.' The MoneyHelper site advises people to 'avoid using a claims management company to get any compensation you're owed'. Some CMCs are merely fishing for customer 'leads', which are then passed on to third-party law firms for a fee. A claims company will usually be regulated by either the FCA or the Solicitors Regulation Authority (SRA) – it should say at the bottom of its website. In both cases the maximum fee you can be charged is 30% (36% including VAT), although solicitors are able to apply to the SRA to charge more for complex claims. That's a lot of money to give up. If you are determined to use a firm, you would be best advised to choose one with a proven record of winning cases in this area, such as the solicitors Bott and Co. Hundreds, if not thousands, of people have taken their cases to court, and in many cases the judge has found in the individual's favour, although Coby Benson at Bott and Co says: 'As far as we're aware, no firms are now issuing court proceedings. This is because any case will just be 'stayed' (placed on hold) by the court until the supreme court has handed down its decision.' However, he adds: 'When we last issued court proceedings, we saw a success rate of 90% and average compensation of about £1,600.' Benson also says: 'The remedy available through the courts is often more generous than that which can be achieved through FCA rules.' That reflects the view that if it does end up setting up a compensation scheme, the FCA will need to balance the interests of consumers, firms and the broader economy. The regulator says that as well as being 'fair to consumers who've lost out', any scheme must 'ensure the integrity of the motor finance market so it works well for future consumers'. Before 2021, many motor finance lenders allowed brokers – usually car dealers – to adjust the interest rates on the finance deals they offered to customers. The higher the interest rate, the more commission the dealer received, so there was an incentive for them to increase consumers' costs. This was known as a discretionary commission arrangement. The Financial Conduct Authority banned DCAs with effect from 28 January 2021 after finding that commission models giving dealers discretion over interest rates could be costing customers about £500m in total more a year than flat fee arrangements. These are where the dealer gets the same commission regardless of the amount of work involved, the credit risk of the customer or the interest rate. DCAs were 'by far the most common commission arrangement' before they were outlawed: on average, between 2007 and 2020, about three-quarters of all motor finance agreements had a DCA of some sort, according to the FCA. A number of car finance providers say they never used DCAs. The MoneySavingExpert website carries a list of firms and brands that say this – they include Bank of Scotland, Carmoola, Halifax, Lloyds (excluding Black Horse) and RateSetter.
