MARTIN Lewis's MoneySavingExpert.com (MSE) has issued an urgent reminder to drivers who could be owed thousands of pounds.
The customer website is encouraging motorists to check if they qualify cash after unknowingly paying too much on car financing.
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It comes as regulator the Financial Conduct Authority (FCA) looks into it thousands of supposedly dodgy deals distributed before January 28, 2021.
MSE claims millions of customers could be owed a total of billions.
But instead of using a claims management company to recover money, the consumer website has launched a free-to-use tool that shows your eligibility.
Martin Lewis previously said: 'The average payback will probably be more than a thousand dollars.
Read more about Martin Lewis
'The big question, if the regulator rules as expected, is whether it will be single- or double-digit billions that have to be paid back to the people.
“I would urge anyone who had car finance before January 2021 to read the guide and use the free tool as soon as possible to ensure that when payments do come, you don't miss out.”
What is the Auto Finance Discretionary Commission Scandal?
The Car Finance Discretionary Commission scandal affects those who bought a car, motorcycle or van with finance before January 28, 2021.
After this date, city watchdog the FCA banned lenders from using “discretionary commission arrangements” (DCAs).
This meant that brokers could no longer raise interest rates on car finance loans, which increased their commissions.
Anyone who took out a vehicle with financing before this date could have wrongly paid more than necessary.
The FCA has now launched an investigation to see how many people have been affected.
There is a handy checklist on the MSE website about who may receive money back.
It also contains a list of companies that are unlikely to have made dodgy deals and therefore do not owe their customers any money.
How do I claim?
It is not clear at this stage whether customer complaints will be dealt with on an individual basis or on a larger scale, as the FCA's investigation is yet to be completed.
Finance firms do not have to deal with complaints until September 25, when the FCA will report the findings of its investigation.
But you must start the complaints procedure now in case a deadline is imposed in the future.
Complete list of companies unlikely to file claims
IF your car financing went through one of these companies, it's probably not worth filing a claim. The current list, according to MSE's website, is:
- Admiral
- Benefit Finances
- Car escape
- Automatic money
- Bank of Scotland
- Billing Finance
- Burnley savings and loans
- Auto Lending Center
- Carmoola
- First response Finance
- Glenside Finance
- Guardian Finance
- Halifax
- Loanable
- Lloyds (excl. Black Horse)
- Mallard Finance
- Moneyshed
- Ooodle car financing
- OploPremium subscription
- RateSetter
- Retail money market
- Specialist in car financing
- Tandem
- Vehicle credit
- V12 Vehicle financing
- 1st Stop Finances
You can use the MSE tool, which allows you to compose a complaint email.
Or you can complain directly to your car finance company.
In the complaint, you should ask whether you were overcharged because your broker received a commission and ask the company to correct it if that happened.
If you are not satisfied with the company's response, you can submit your complaint to the Financial Ombudsman (FOS) free of charge.
You won't need to rely on a claims agency throughout the process, as these companies typically take a percentage of the payout you receive.
In other news, Martin Lewis warned everyone who is divorced because of a simple blunder that could give your ex your pension.
Plus, a new warning to pet owners to make a major move or risk a £500 fine.
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