Close Brothers Group Plc has announced its continued commitment to handling the extra provision for car finance redress despite additional financial burdens, according to a recent report by London South East. The lender's statement comes as part of an ongoing industry-wide response to the Financial Conduct Authority (FCA) motor finance review that affects over 12 million agreements and £7.5 billion in total expected redress.
The FCA review, which covers car financing arrangements made between April 6, 2007, and November 1, 2024, has identified widespread issues with the sale of Personal Contract Purchase (PCP) and Hire Purchase (HP) agreements. These problems include inadequate disclosure of terms and conditions, aggressive sales tactics, and mis-selling practices that may have resulted in customers overpaying for their vehicles or taking on unaffordable credit.
What Does This Mean for UK Drivers?
The FCA's review has implications for millions of car owners who entered into PCP or HP agreements during the specified period. According to the regulator, an average compensation payment of £829 is expected per agreement. However, drivers must act promptly and understand their rights if they wish to pursue a claim.
Close Brothers Group Plc is one of several lenders affected by the FCA's review that are taking steps towards compensating customers who may have been mis-sold car finance products. The company has set aside provisions to cover potential claims but stresses that the process will be managed according to regulatory guidelines and timelines established by the FCA.
Drivers concerned about their agreements should first consult MLJ’s guides on PCP versus HP car finance here for a detailed explanation of each type of financing. Understanding these options can help clarify whether a mis-selling scenario may have occurred.
What Should Drivers Do If They Think They Were Mis-Sold Car Finance?
If you suspect that your car finance agreement was mis-sold, the first step is to review any documentation related to your deal. This includes contracts, brochures, and promotional materials that might indicate misleading information or aggressive sales tactics. MLJ’s finance checker can help determine if a claim may be warranted based on your circumstances.
Drivers should then contact their lender directly for free assistance without involving claims management companies. According to the FCA guidelines, consumers are advised to approach lenders themselves since third-party firms often charge fees and might delay or complicate the process. You do not need a claims management company to seek redress; most banks and finance providers have dedicated teams ready to assist with inquiries.
Lenders are expected to respond to complaints within eight weeks of receipt, according to standard FCA regulations. The timeline for compensation varies but typically begins after an investigation confirms eligibility based on the review's findings. Compensation may be processed through direct bank transfers or credit notes applied to ongoing finance agreements.
What Are the Next Steps After Identifying a Potential Claim?
Once you’ve confirmed your eligibility and identified potential issues with your car finance agreement, document all communications with your lender thoroughly. Keep records of emails, phone calls, letters, and any other forms of correspondence that outline your complaint and the lender’s response.
It's also advisable to familiarize yourself with the FCA’s final report on motor finance, which provides full details about the review process and expected outcomes. The full document is available here.
In summary, while Close Brothers Group Plc remains committed to addressing the extra provision for car finance redress, UK drivers must take proactive steps to understand their rights and pursue claims efficiently. By consulting reputable sources like MLJ’s guides on hire purchase here and PCP financing, motorists can deal with the complexities of mis-sold car finance with confidence.
For ongoing updates and detailed information, drivers are encouraged to visit MLJ.org.uk regularly or contact their lender directly for free assistance.