The BMW 5 Series was commonly sold on
Personal Contract Purchase (PCP) and
Hire Purchase (HP) finance agreements during the Financial Conduct Authority's (FCA) investigation period, which spanned from 6 April 2007 to 1 November 2024. This investigation uncovered significant issues with
discretionary commission arrangements that lenders used when selling these agreements.
How the BMW 5 Series was Typically Financed
The BMW 5 Series is a premium car model known for its luxury and performance, making it an attractive choice for many drivers. During the period under scrutiny by the FCA, financing options for this vehicle were primarily structured through PCP and HP agreements with typical finance amounts ranging from £15,000 to £30,000 (FCA estimate). These agreements usually had a term of 36-48 months, offering consumers flexible payment terms and the option to purchase or return the car at the end of the agreement.
Common lenders for BMW 5 Series finance include
Black Horse, Barclays Partner Finance,
Close Brothers Motor Finance,
MotoNovo Finance, and
Santander Consumer Finance. These institutions often provided financing options that included balloon payments-large lump-sum payments due at the end of a PCP or HP contract. Balloon payments can significantly impact affordability and are a critical aspect to review in any finance agreement.
The FCA Motor Finance Investigation
The FCA's investigation revealed widespread issues with discretionary commission arrangements, which were used by lenders when selling motor finance agreements like those for the BMW 5 Series. Under these arrangements, car dealerships could receive additional commissions based on factors such as the type of finance agreement and the size of the deal. This system was found to encourage practices that were not always in consumers' best interests.
The FCA estimated that 12.1 million eligible agreements (FCA, March 2026) by these issues (FCA estimate), with a total value of £7.5 billion (FCA, March 2026). On average, each consumer could potentially be entitled to compensation of about £829 (FCA estimate) due to unfair practices during the sale and administration of motor finance.
How to Check Your Agreement Key things to look for include any mention of "Discretionary Commission Arrangements" (DCA) or similar terms indicating that the lender paid additional incentives based on the type and size of the deal.
Relevant dates are also crucial: agreements entered into between 6 April 2007 and 1 November 2024 fall within the FCA investigation period. If your finance agreement was made during this timeframe, it is worth checking whether any unfair practices might have been applied to your contract.
If you suspect that your BMW 5 Series finance agreement may have been affected by the issues identified in the FCA investigation, you can complain directly to your lender at no cost. Common lenders such as Black Horse, Barclays Partner Finance, Close Brothers Motor Finance, MotoNovo Finance, and Santander Consumer Finance all offer complaint resolution processes.
You do not need a
claims management company to handle this process for you; their services often come with fees that are unnecessary if you can resolve the issue directly through your lender's complaints department. The
Financial Ombudsman Service (
FOS) also provides free mediation if your lender does not satisfactorily address your concerns.
Sources and References
- Financial Conduct Authority, 2024
- Financial Ombudsman Service, Various Reports
Based on 71,775 MOT tests conducted in 2024 (source: DVSA anonymised test data), the BMW 5 Series has a pass rate of 87.0%. This is above the national average of 79.6%, meaning the 5 Series performs well in MOT testing.
The 5 Series pass rate is better than the overall BMW average of 84.8%. The average mileage at MOT for this model is 80,427 miles.
- MOT pass rate: 87.0%
- MOT failure rate: 13.0%
- Tests analysed: 71,775 (2024 DVSA data)
- Average mileage at test: 80,427 miles
- BMW average pass rate: 84.8%
- National average pass rate: 79.6%
Data source: DVSA anonymised MOT test results 2024, published under the Open Government Licence v3.0.