Introduction
Personal Contract Purchase (PCP) is one of the most popular car finance options in the UK, offering flexibility with lower monthly payments. However, many PCP agreements were mis-sold, leaving customers unaware of hidden costs and unfair terms. This guide explains how to identify mis-sold PCP finance and claim the compensation you deserve.
What is PCP Car Finance?
PCP is a type of car finance that allows you to make lower monthly payments with the option to buy the car at the end of the term by paying a final “balloon payment.” While it seems straightforward, PCP deals often come with complex terms that aren’t always fully explained.
Common Mis-selling Practices in PCP Agreements
Mis-selling in PCP agreements often includes:
Undisclosed Commissions:
Dealers earning commissions without informing the customer.
Inflated Balloon Payments:
Customers face unexpectedly high final payments.
Misleading Interest Rates:
Interest rates were sometimes higher than initially advertised.
Inappropriate Recommendations:
Customers were sold PCP deals unsuitable for their financial situation.
How to Check if Your PCP Agreement Was Mis-sold
You might have been mis-sold a PCP deal if:
- The dealer didn’t explain the full cost of the agreement, including the balloon payment.
- You weren’t told about the commission paid to the dealer.
- The interest rate or other key terms were different from what was initially promised.
- You were encouraged to take out a PCP deal despite it not being the best option for your needs.
Steps to File a Mis-sold PCP Finance Claim
What Compensation Can You Expect?
- Refunds of overpaid interest and fees.
- Adjustments to your outstanding balance.
- Financial compensation for any losses due to the mis-selling.
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Frequently Asked Questions
A Personal Contract Purchase (PCP) is a car finance option offering lower monthly payments with a final balloon payment at the end of the term.
Mis-selling can occur through undisclosed commissions, misleading terms, or selling agreements unsuitable for the customers financial situation.
Yes, even if you have canceled or completed your PCP agreement, you may still be eligible to claim for mis-selling.
You will need your finance agreement, proof of payments, and any correspondence with the dealer or finance provider.
The process can take several months, depending on the complexity of the case and the response from the finance provider.
