Green light to claim back £950

MILLIONS who took out car finance before 2021 could be due money back after a huge week of headlines.

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First came the Supreme Court's long-awaited judgment on three big legal cases about hidden car finance commissions. Two of those cases, about if dealers had a special duty to act in your best interests, and whether hidden commission counted as a "bribe", were shut down by the Court.

But in the third, judges ruled that one deal was "unfair" because more than half the cost of the loan went to commission, and customers weren't told. This case was upheld, which leaves the door open for similar claims.

For most, the bigger news is what happened immediately after. Off the back of the third case, the regulator, the Financial Conduct Authority (FCA), confirmed plans to consult on a mass compensation scheme tackling Discretionary Commission Arrangements (DCAs).

That's where dealers hike your interest rate to boost their commission. This was banned in January 2021, but between 2007 and the ban, it's thought to have featured in around 40% to 50% of car finance deals. If you took out hire purchase or personal contract purchase (PCP) car finance before January 28, 2021, and weren't informed about the commission structure, you could be due money back.