How to Navigate Car Finance Firm Disputes: Advice from Martin Lewis

Renowned financial expert Martin Lewis has provided guidance for drivers who may find themselves affected by the latest investigation initiated by the Financial Conduct Authority (FCA) into car finance firms. In the midst of the probe surrounding potential misconduct related to discretionary commission arrangement deals, Lewis is offering advice on how affected drivers can respond if they feel they are being ignored or given the runaround by finance companies.

In light of the FCA’s investigation, it is estimated that “millions” of individuals who purchased vehicles on finance before January 2021 could be impacted, with compensation payouts anticipated later this year. According to Lewis, those who suspect they may be affected should take immediate action by sending a formal complaint letter to their lender. Over 600,000 complaint letters have already been sent to firms after a template was made available online by MoneySavingExpert.

Despite the fact that firms may take up to 28 days to respond to customers, Lewis warns that some individuals may be unfairly brushed off by companies attempting to limit their liability. He urges affected parties not to be deterred by responses such as, ‘we don’t think we’ve done anything wrong’ or ‘complaint rejected, but you can go to the ombudsman’. Lewis compares these tactics to those commonly observed during previous financial disputes, emphasizing that individuals should not be dissuaded from pursuing their complaints.

He reminds affected individuals that once a complaint is logged with their lender, they have fulfilled the necessary steps until the FCA reports its findings. Furthermore, Lewis advises individuals to refrain from pursuing further action, such as appealing to the ombudsman, until the FCA’s report is released. He also alerts consumers to incorrect information disseminated by some firms regarding the timeframe for escalating complaints to the ombudsman, ensuring that affected individuals are informed and not subject to unnecessary pressure.

The FCA’s investigation was initiated following recent decisions by the Financial Ombudsman in favour of two complainants, a development that has triggered expectations of a surge in complaints from consumers directed towards finance firms. Lewis, drawing from his expertise, suggests that up to 40 percent of all complaints could be successful in securing compensation, with an average payout estimated at around £1,100. Consequently, he anticipates that lenders may be required to repay over £230 million in compensation.

As individuals navigate the complexities of the FCA’s investigation and potential disputes with car finance firms, Lewis’s astute advice provides a clear roadmap for taking action and seeking fair redress. By adhering to his recommendations, affected individuals can navigate the process with informed confidence and advocate for their rights.