Received a provisional car finance redress decision? What to check before accepting it
A provisional car finance redress decision should be reviewed carefully before you accept it. Under the FCA scheme, a compensation offer is made in full and final settlement of claims against the lender that fall within the scheme and relate to the agreement or case being assessed. Acceptance can therefore close further arguments about that scheme outcome.
The position is currently unusual because the scheme was partially suspended on 2 July 2026. While the Upper Tribunal challenge continues, lenders do not have to calculate or pay compensation or send communications about compensation owed. They must still prepare cases and, in many circumstances, tell consumers who are not due compensation. If you received a decision before the suspension, or receive a no-redress decision while it remains in place, check the deadline immediately.
What a provisional decision should explain
The letter should state whether the lender believes the agreement created an unfair relationship, whether loss resulted and what redress, if any, is proposed. Where compensation is offered, it should explain the calculation, assumptions or reconstructed information, compensatory interest and any proposed deduction for arrears or default sums.
The FCA estimates average compensation of around £830 per eligible agreement, but this is an industry-wide estimate, not a standard award or guaranteed minimum. What compensation might look like depends on the commission arrangement, cost of credit, payment history and evidence available.
What to check before responding
Confirm the customer details, lender, vehicle and agreement dates. The scheme covers certain regulated motor finance agreements entered into between 6 April 2007 and 1 November 2024, but not every agreement within that period qualifies. Check that every agreement you expected to be assessed is identified. Multiple agreements used for one vehicle transaction may be considered together. Claiming on a settled or older agreement can still be possible where the rules and time limits are met.
Read the calculation rather than relying only on the headline figure. Ask the lender to explain missing payments, commission figures, interest, assumed data or anything you cannot reconcile with your records.
Check deductions carefully. A lender may propose setting redress against undisputed arrears or default sums owed under the relevant agreement. For a transaction financed through more than one agreement, set-off may apply against related agreements from that transaction, but it should not be applied to unrelated borrowing. You can object where the arrears were already disputed and unresolved, or where the deduction would leave you unable to meet priority debts. How a complaint affects your credit file is also relevant if the agreement remains active, but making a complaint does not itself justify stopping repayments.
Know the response deadline
A provisional redress decision normally gives you one month to accept it, object or opt out of the scheme. If you do not respond, the lender should normally issue a redress determination confirming its position. That determination must provide at least six months in which to accept it. The time limits on car finance complaints explains why the date and type of letter matter.
If you disagree with the outcome
Object to the lender within the stated period and identify each disputed point, supported by documents where possible. The lender must consider whether the decision or calculation should be revised.
If the lender issues a redress determination and you remain dissatisfied, you can refer the matter to the Financial Ombudsman for free. Under the scheme, it generally reviews whether the lender followed the FCA's scheme rules, rather than reassessing the complaint using a different formula. The car finance complaint process explains the route. Court action may also be possible, but obtain independent legal advice before choosing between routes.
Get the decision checked
Claim First can review a decision under its service terms. You can also complain directly to the lender and use the Ombudsman without paying a claims company. Claim First operates on a no-win, no-fee basis, with a success fee of 15% to 30% plus VAT where compensation is recovered.
If you have not complained, you can start a mis-sold car finance claim. Claim First also assists with payday loan refunds, housing disrepair claims and scam recovery. Check every figure, deduction and deadline before accepting.
