Mis-sold PCP Agreement: You Could Be Owed Compensation
If your Personal Contract Purchase (PCP) agreement was unfair, such as excessive commission fees, you could be entitled to compensation.
At Elmwood Law, we make it easy to find out — no jargon, no unnecessary hassle, just a clear, online claims process the whole way through.
How It Works
1. Submit your claim online
Answer a few simple questions. It only takes minutes.
2. We verify your details automatically
Our system securely checks your information in real time.
3. We handle the legal side
Our legal team builds your case and manages all communication.
4. You receive your compensation
If your claim is successful, we’ll ensure your compensation is processed promptly.
What Is a PCP Agreement?
A PCP agreement is one of the most common methods of financing a car in the UK. It works like this: you pay a deposit and monthly payments, then at the end of the term, you choose whether to buy the car, return it, or part-exchange it for a new one. Sounds straightforward, but in too many cases, vital information wasn’t shared. Dealers often failed to disclose essential details of commission arrangements that may have affected the consumer’s decision.
The primary affected commission model is Discretionary Commission Arrangements (DCAs), where the lender allows the dealer to set the interest rate on the loan. The higher the interest rate the dealer arranged, the more commission they earned. This created a clear conflict of interest, and many customers ended up paying more than they needed to, without ever knowing why. Other commission models may also apply to mis-selling if the fee is deemed to be too excessive.
Why It Matters
Mis-selling affects more than just your wallet — it’s about fairness and transparency. You may have agreed to a deal without being given all the facts, and that could mean you paid more than you should have. This issue has gained national attention. The Financial Conduct Authority (FCA) has been investigating widespread concerns around unfair lending practices in car finance. It’s a clear signal that change is coming, and that affected drivers have the right to challenge what happened. Elmwood Law can help you take the next step.
A Mass Redress Scheme Has Been Confirmed
The Financial Conduct Authority (FCA) confirmed the details of its anticipated redress scheme in March 2026, following an extensive consultation process. Under this scheme, 12.1 million agreements are eligible for compensation, with firms expected to pay out around £7.5 billion. Eligible consumers include those who weren’t told about a discretionary commission arrangement (DCA), a high commission arrangement, or contractual ties that give a lender exclusivity or a right of first refusal.
The FCA estimates that the average redress per agreement will be £829. Consumers should start receiving compensation in 2026, with a short implementation period in place so that firms can prepare. This period will be up to 30 June 2026 for agreements taken out from 1 April 2014, and 31 August 2026 for earlier agreements. For complaints put in before these dates, lenders must let customers know if they’re owed compensation and how much within 3 months from the end of the implementation period. If a consumer has not made a complaint, the lender has 6 months from the end of the implementation period to contact them if they are owed money.
Please be advised that you do need to use a law firm to access this redress scheme. However, there are advantages of instructing a law firm to do so, including reducing the time and hassle of filing paperwork or communicating with your lender.
How Elmwood Law Can Help
We’ve reimagined the legal process around your needs. Our team uses smart technology and legal expertise to handle mis-sold car finance claims efficiently, clearly, and entirely online. That means:
- No mountains of paperwork.
- No waiting for appointments.
- No confusing legal language.
- Just clear progress, and a team you can trust.
You could be owed compensation — and it only takes a few minutes to get started. Elmwood Law makes the process efficient, clear, and entirely online.
Frequently Asked Questions
Can I claim on my own?
You can submit your claim yourself for free without using a law firm. You can also refer the complaint to the Financial Ombudsman Service yourself for free. Before escalating the complaint to the Financial Ombudsman Service, you must first lodge the complaint with the provider.
The FCA has confirmed a consumer redress scheme. Under this scheme, you do not need to register a complaint to be eligible for or receive compensation. You also do not need to use a claims management company or a law firm to access the scheme.
There are benefits to choosing us to manage your claim, including allowing us to handle all communication with the lender, where we will work closely with them to ensure you receive a fair level of compensation. If the provider encounters any problems locating your details, we will assist them to ensure your claim proceeds as normal. After registering with us, you can sit back and relax while we handle everything for you. We will keep you updated via email throughout the process.
What do I need to see if I can claim?
To see if you are entitled to make a compensation claim, you will need your vehicle registration number or your lender’s name, along with some basic personal details, that’s it! We’ll take care of the rest of the process on your behalf.
Can I make a claim for multiple vehicles?
If you purchased multiple vehicles on car finance through a PCP agreement, you could claim for them all. Use our online check to get started.
What do I need to do to register?
You can start registering in only 2 minutes. Our online registration process is easy to use. All you need to do to get started is tell us about yourself and how you bought the vehicle. If eligible, you can then sign up to start your compensation claim.
Can I still claim if I’ve fully repaid my finance?
Yes, whether you’re still paying off your car finance or if it’s been fully settled, the product was still mis-sold and you can still submit a compensation claim.
When will I be paid?
Under the mass redress scheme, the FCA expects consumers to start receiving compensation in 2026. There is an implementation period of 30 June 2026 (agreements after 1 April 2014) and 31 August 2026 (agreements before 1 April 2014). Lenders should let know claimants known within 3 months from the end of these periods if they’re owed compensation and how much. You will then have 1 month to accept or challenge the lender’s response. After an offer is accepted, the lender will need to pay your compensation within 1 month.
If you do not put in a complaint but are eligible for compensation, the lender must contact you within 6 months of the end of the implementation period.
