What evidence is required?
The burden of proof lies with the lender to show that in all aspects of the process of the sale of the vehicle and finance they have acted within the law. You could be entitled to claim compensation for mis-sold vehicle finance if you answer no to any of the following questions.
- Did the salesperson explain the finance deal they sold to you in sufficient detail?
- Did the salesperson present to you every finance option available, including explaining all of the differences in each type of finance deal
- Was the salesman completely transparent with the interest rates charged for all loan options and how each loan you could purchase may differ?
- Did the salesperson offer the best interest rate available to you?
- Did the salesperson convince you into purchasing a finance deal that was unaffordable?
- Did the salesperson clearly explain to you who was financially responsible for any repairs to the vehicle?
It is the dealership’s responsibility that to show they did all of the above. If the dealership cannot prove that they did all of the above, you will be eligible to claim compensation for the mis-sold finance agreement.
Should you be unsure about any of the questions above, we will review your agreements and inform you as to whether you can claim.
Hidden Commission and Secret Commission
In the process of completing the investigation on your claim we will be able to decipher as to whether your finance deal contained hidden commission and/or secret commission.
The FCA 2019 report has shown that numerous vehicle finance companies have included hidden commission and secret commission in finance deals offered to consumers.
You may be able to claim compensation for a mis-sold vehicle finance deal if you believe that commission was hidden from you in the finance deal.
In vehicle finance – hidden commission is where the dealership/salesperson sells you a finance agreement from a lender.
If the dealership/salesperson received commission for delivering the vehicle finance deal to the lender, and the lender did not inform you of the commission then that is a hidden commission. You were not expressly informed about the commission the dealership/salesperson received as a result of you opting into the finance agreement. The lender must inform its consumers of every fee within the transaction.
The dealership should have informed you at the point of the vehicle sale how much the commission was they would receive as a result of you purchasing the finance agreement. If the dealership failed to do this, it is fraud. The liability for the mis-sold vehicle finance may then lie with the finance provider and the finance broker.
In the FCA’s official report they have shown that some vehicle finance providers/lenders have concealed the existence of any commission offered by their brokers. In the FCA’s investigation in relation to the mis-selling of PCP finance agreements, they found that:
Only 11 out of the 122 dealerships visited by mystery shoppers confirmed that commission will be added to this type of deal. The remaining 111 dealerships did not disclose whether the commission would be added to the mystery shoppers’ finance deal.