A Guide to Mis-Sold PCP Car Finance - What You Need To Know
Personal Contract Purchase (PCP) is one of the most popular ways to finance a car in the UK. The monthly payments are usually lower, the structure looks flexible, and you often get the choice to return, upgrade or buy the car at the end.
But PCP comes with more moving parts than people expect, balloon payments, mileage rules, extra charges, future value assumptions and interest that isn’t always explained clearly. Over time, many customers have started to realise that key details may not have been discussed properly at the dealership.
This pillar page brings together everything you need to know about PCP mis-selling, explained simply and supportively, and how Mis-Sold Expert can help you review your agreement with clarity and confidence.
How PCP Finance Works
A typical PCP agreement involves:
- Fixed monthly payments for a set period
- A large optional final payment (the balloon payment)
- Mileage limits you must stick to
- Conditions on the car’s value at the end
- Options to return, part-exchange or purchase the vehicle
It’s flexible, but it can also be confusing, especially when those choices aren’t explained in the way they should be.
Where PCP Mis-Selling Can Happen
Mis-selling often happens when important information is missing or not communicated clearly. For many people, this only becomes obvious later on.
Common issues include:
- The balloon payment not being explained properly
- Confusion around mileage limits and extra charges
- Interest rates or total costs not made clear
- Being pushed into PCP instead of HP or other options
- No proper affordability checks
- The dealer earning commission you didn’t know about
If any of this sounds familiar, Mis-Sold Expert can take a look at your PCP documents and help you understand what may have gone wrong.
The Balloon Payment: A Key Source of Confusion
For a lot of customers, the balloon payment is the part of PCP that causes the most worry. It’s often thousands of pounds and can make the car far more expensive overall.
When this wasn’t explained clearly, or was made to sound optional when it wasn’t fully understood, it can lead to people feeling misled about the true cost of the agreement.
If you weren’t sure how the balloon payment worked at the time, Mis-Sold Expert can help you review this to understand how clearly it was presented.
Commission and Interest Rates: What You Weren’t Told
Many PCP deals involved commission being paid to the dealership or finance broker. In some cases, the dealer may increase the interest rate to earn a higher commission, a practice known as a discretionary commission arrangement.
The FCA has raised concerns about this, and many customers were never made aware it was happening.
If commission wasn’t mentioned to you at all, or the rate seemed higher than expected, Mis-Sold Expert can help you understand how this may relate to your agreement.
Signs Your PCP Agreement May Be Worth Reviewing
People often come to Mis-Sold Expert when they:
- Didn’t understand how the balloon payment worked
- Were surprised by extra charges or mileage penalties
- Weren’t shown alternative finance options
- Found the agreement unaffordable from the start
- Later discovered commission they were never told about
- Felt pressured to take the deal on the day
These are common reasons customers ask Mis-Sold Expert for a review — not guarantees of mis-selling, just signs that something may not have been explained clearly.
Your Options If You’re Worried About PCP Mis-Selling
If you feel something wasn’t right about how your PCP was sold, you can:
- Raise a complaint directly with your lender or the dealership
- If the response doesn’t help, escalate it to the Financial Ombudsman Service
- Work with a regulated claims management company for support
If you’d prefer guidance throughout the process, Mis-Sold Expert can help you understand your agreement and the options available, always using clear, friendly and FCA-compliant communication.
How Mis-Sold Expert Supports You
When you ask Mis-Sold Expert to review your PCP agreement, you can expect:
- A careful look through your finance documents
- Clear explanations of fees, interest, balloon payments and commissions
- Guidance that is simple, supportive and easy to follow
- Transparent communication at every stage
There are no assumptions made about your situation and no guaranteed outcomes, just honest, helpful guidance.
What The FCA's Redress Schema Can Cover
If a PCP agreement was mis-sold, redress may relate to things like:
- Overpaid interest
- Fees or charges that weren’t clearly explained
- Issues linked to unfair relationships under consumer credit rules
The amount varies from person to person. Mis-Sold Expert focuses on helping you understand whether your circumstances suggest mis-selling, without promising a particular result.
What Happens When Mis-Sold Expert Reviews Your PCP Agreement
Most people find the process reassuring and straightforward:
You share your PCP details
Mis-Sold Expert reviews the information carefully
You receive simple, jargon-free feedback
You decide what you’d like to do next
If you’ve had more than one vehicle on PCP or HP, Mis-Sold Expert can review each agreement individually.
Recent Developments in PCP Fairness
There has been increased focus on how car finance was sold across the UK, especially around commission and transparency. Courts have highlighted the importance of clear, honest communication, particularly where customers relied on the dealer’s advice.
Mis-Sold Expert stays up to date with these developments so you can feel confident you’re getting the most accurate, balanced explanation of your situation.
Here When You Want Clear Answers About Your PCP Agreement
If you want simple, reassuring guidance that helps you understand whether your PCP car finance was sold fairly, Mis-Sold Expert is here to support you from the moment you reach out.
You can claim without using a claims management company; you can go to your finance provider and then to FOS, for free. Additionally, the FCA is introducing a free consumer redress scheme.
