Sun, 30 Mar 2025

Sun, 30 Mar 2025 Car finance case could spark billions in driver payouts

Millions of motorists could be in line for payouts depending on the decision of Supreme Court judges.

* The UK's Supreme Court will hear a case that could determine whether millions of motorists are eligible for compensation, with lenders setting aside huge sums of money in preparation.
* A Court of Appeal ruling last year found that hidden commission payments to dealers were unlawful and customers should be informed and agree to them before signing loan agreements.
* The car finance sector is the second biggest lender to consumers in the UK, with millions of people buying new and used cars on finance agreements.
* Motorists may be eligible for hundreds of pounds in compensation if they signed up to loan agreements that included hidden commission payments.
* The Financial Conduct Authority (FCA) has received a deluge of complaints from dealers and motor finance providers and is urging customers to make claims.
* The Supreme Court's ruling is expected during the summer, with lenders facing a hefty compensation bill regardless of the outcome.
* Estimates suggest that if the judges agree with the appeal, compensation payments could run into tens of billions of pounds, while if not, 40% of car loan agreements could still be eligible for compensation worth billions.
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