Car Finance Claim Example

Here is a basic example of a claim if you borrowed £10,000 for a vehicle purchase, but at the end of the contract you have paid £16,000 in total. This is just for illustration purposes:


  • Initial Loan – £10,000
  • Arrangement Fee – £2,000
  • Interest – £4,000 (of which, £1,500 was paid to the dealer in hidden commission)
  • Total Repaid – £16,000

The initial loan of £10,000 must be returned to the lender as what we consider the counter-restitution (this will not affect the vehicle purchase). With rescission of the contract (cancels the contract from the beginning as though it did not exist) our claim on your behalf will be for the arrangement fee and the interest to include the hidden commission, which will be a total of £6,000. As you have been out of pocket of this £6,000 for some time, we will then seek to claim interest on the £6,000 from the date that you paid it. The reason we are claiming the compensation, is that these are unjustly gotten benefits due to the fact that the dealer hidden commission from you i.e. did not confirm with you that they would receive a commission for selling you the product from the lender. The Courts take this as a bribe and special form of fraud.

It is possible that the lender will argue that some if not all of those individual amounts are still payable and if not agreed at the outset, these may be the subject of negotiations which can be agreed by you, via the Financial Ombudsman Service (FOS) or ultimately determined at Court.

Let’s say we are successful in negotiations with the lender for the claim and the full amount is agreed and we also recover interest, to keep things simple for the example at £500. This will be total compensation recovered of £6,500.

Chan Neill Solicitors fees will be 30% + VAT (currently 20%) of the compensation recovered, which will total  fees of £1,950 + VAT of £390, totaling £2,340. The SortMyCash fee will be payable by Chan Neill Solicitors for the processing, handling and introduction of the claim.

You will therefore receive a payment of £4,160.00.

Please note: This is a basic example of a claim and the actual process may be much more complicated. Chan Neill Solicitors will always try to get your claim settled in the quickest possible time, at the maximum possible compensation and without the necessity of going to court. However, in some cases there are strong defensive arguments from Defendants and this may require compromise with compensation expectations or it can lead to a lengthy process. We need you to be aware that some claims that require Court can take up to 48 months or longer to settle. If the claim does go to Court, you may require what is called an After The Event (ATE) insurance premium, unless you have legal cover in either your car insurance, home insurance, bank or any other such policies. As ATE is not recoverable from the other side, this will be payable from your compensation when this recovered, but will cover itself and therefore if you lose the claim this will pay itself along with your opponents costs. As this No Win, No Fee, we reiterate that in the event that you do lose your claim, you will not pay any costs. Again, our partners will do everything they can to negotiate and avoid court, but if this does proves necessary, they may require patience if it is a particularly difficult Defendant. Your best interests will always be at the heart of the claim.

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