It's never been more popular to buy a car in the UK than it is now. There are many benefits that come with purchasing a vehicle, but there are also some risks which you need to be aware of. One risk is being mis-sold car finance products by the dealership or local high street lender. A recent survey found that this was the second most complained about financial product and over a third of complaints were made against car finance firms.
Consumers have been increasingly dissatisfied with the car finance arrangements they've entered into. These fail to provide what was advertised, or simply see you paying a lot more than expected for them - in our experience most customers who aren't satisfied are those that were sold an unsuitable product by their lender.
Irresponsible lending in the UK finance industry is the latest mis-selling scandal
It's been a while since the PPI scandal rocked UK banking, but it seems that another financial product is in danger of becoming an even bigger issue. Car finance has become more popular than ever before and unfortunately many people have fallen victim to irresponsible lending practices with car financing products not delivering what was promised. Loans are a necessary evil, but irresponsible lenders can take advantage of desperate people. It's so important to feel confident in any loan you're taking that you know exactly what the interest will be like and there won't be any surprises when it comes time for payback!
Why Was Car Finance Mis-sold
Car finance was usually mis-sold because the dealer did not do a very good job of explaining all the information. It wasn't always clear what financing deals meant, from monthly payments to maximum interest rates and penalties. There's more to it than just jumping in and handing over your cheque book when somebody tells you "It's easy!"
8 Reasons why you may have been mis-sold a UK car loan.
- The car finance company was not transparent about the terms and conditions of your contract. This can happen if they don't provide you with a copy before signing, or make it difficult to understand what's on offer when explaining things verbally over phone calls.
- You were not given the opportunity to shop around for a better deal. A car finance company should always present you with at least two options, and allow time before signing anything so that they can compare them on your behalf - this is called "competing quotes."
- It was not clearly stated who was responsible for dealing with the car repair. If you're not told who will be responsible for the car's maintenance, then it is likely that this has been left out of your contract.
- You were given a loan with an interest rate higher than advertised or agreed to in person or by phone.
- You were not given information about how to avoid paying early redemption penalties when selling or trading-in of vehicle and/or repayments if sold as part exchange for another new purchase.
- The dealer didn't explain who owned the vehicle in some instances. Some people have been found to be working with a third-party firm, not actually at the car dealership.
- The commission aspect of the sale was not correctly explained, or the customer was not told that they would have to pay a fee for this service.
- You were not told about the length of time you would be paying for or what happens if your circumstances change. You may have been given a loan that is unsuitable to meet future financial needs, such as when interest rates are likely go up in coming months/years and it's more expensive than anticipated.
If you feel you have been ripped off by a car finance company, it's not impossible to get your money back we can help make a claim on your behalf. We'll take care of all aspects in making a claim, so there are no worries or stress involved with getting back what you may be owed.
We will be able to advise on whether the car finance was sold inappropriately, and help with reclaiming any money owed as well, should it need this level of intervention in order for things to be resolved satisfactorily.