Santander Car Finance Claims

Santander Car Finance Claims Explained

Santander Consumer Finance has been providing motor finance agreements to customers through car dealerships and credit brokers in the UK, the usual way that motor finance is arranged. These are often referred to as Hire Purchase, Personal Contract Purchase, or Conditional Sale agreements, as you'd expect from any other lender in the motor finance sector. And just like everybody else in this sector, there have been questions raised about how some of these historic agreements were presented to customers, specifically the bit where commission arrangements may not have been clearly explained.

When it comes to Santander car finance claims, the focus is usually on how the finance deal was explained and introduced to the customer at the time. And in some parts of the motor finance industry, dealerships have historically used commission models, which can be pretty tricky to understand. These models basically allowed a dealer or broker to have some influence over the interest rate, and get paid a bit extra based on the rate they managed to get for the customer.

If the way the commission was structured wasn't clearly explained, then customers were unaware of how the interest rate was being calculated, or whether the dealer had any influence over the rate that was being offered to them. The Financial Conduct Authority lays down pretty strict rules about how this should work so that customers are treated fairly during the sales process, and get clear information from lenders and brokers.

The majority of Santander car finance claims centre around Personal Contract Purchase and Hire Purchase agreements, which were arranged between 2007 and 2024, before the rules around commission changed and discretionary commission models were banned in 2021. However, not every agreement is affected, so it's worth checking which type you had and when it was arranged.

If you do decide to submit a Santander car finance claim, don't expect to automatically be compensated. Each agreement will be looked at individually to see if it's eligible. This will involve checking out if the interest rate was explained, whether the commission arrangements were spelt out, whether the right affordability checks were done, and whether the whole sales process met the rules at the time.

The FCA has temporarily relaxed the rules around how long it takes to sort out these sorts of complaints while it carries out a wider review of the whole motor finance sector. You can still go ahead and submit a complaint to Santander Consumer Finance, and if you're not happy with the response you get, you can refer it to the Financial Ombudsman Service free of charge.

If you are reviewing your agreement, you might want to check out a few things - the date the finance was taken out, what type of agreement it was, and which dealership was involved in setting it up. That can give you a pretty good idea whether your Santander finance agreement might be affected by any of these current worries.

If you're not entirely sure how to proceed, Mis-Sold Expert can give you the lowdown on what your options are and help you figure out what to do next.