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What Is a PCP Claim and Who Can Make One?

January 2026

A PCP claim is a legal complaint filed by a consumer who feels that Personal Contract Purchase (PCP) car finance agreement for their vehicle has been mis-sold. PCPs can be considered one of the most popular car finance options for vehicle buyers in the UK. Nonetheless, PCPs have become complex and have faced growing concerns from regulators.

Many consumers entered into PCP contracts without fully understanding costs, their position with regard to ownership, or affordability. Thousands of motorist drivers are, therefore, presently examining if these contracts have been offered to them equitably in accordance with consumer credit regulations.

This guide explains:

How PCP finance works in practice
What regulators consider PCP mis-selling
Who can make a PCP claim
Which lenders are commonly involved
How PCP claims are assessed and resolved

If you are unsure whether your agreement may be affected, you can use the PCP claim calculator.

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Understanding PCP Finance in the UK

Personal Contract Purchase is a consumer credit structure that is heavily regulated. Instead of buying the whole price of a car and financing it, the PCP agreement revolves around the purchase of the depreciation value of a car.

In a typical PCP arrangement, a deposit payment, regular payments, and a final “balloon payment" or so-called Guaranteed Future Value (GFV) are required. The vehicle will remain the legal property of the lender until the final payment has been realised.

PCP Component	What It Means	Why It Matters for Claims
Deposit	Upfront payment at the start of agreement	Low deposits can obscure total cost
Monthly Payments	Fixed payments over the agreement term	Often emphasised over overall affordability
Interest Rate (APR)	Cost of borrowing	Not always clearly explained
Guaranteed Future Value (GFV)	Final payment to own the car	Frequently misunderstood
Mileage allowance	Annual mileage limit	Excess charges may not be disclosed
Vehicle ownership	Lender owns the car during the term	Many customers believed they owned the car

More detail on how PCP agreements work can be found here: https://www.pcpmissold.co.uk/how-it-works

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What Is a PCP Claim?

A claim for PCP raises questions regarding whether a finance deal lawful under consumer credit regulations regarding general understandings about what constitutes a fair deal for purchase.

The claims are brought against the finance lender and not against the car dealership because it is primarily the finance lender's responsibility to ensure that financing meets approved lending criteria.

If a claim is upheld, the outcome may include:

Refund of interest or charges
Recalculation of the agreement
Reduction of outstanding balances
Compensation for financial detriment

The remedy depends on how the agreement was sold and the impact on the consumer.

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What Does PCP Mis-Selling Mean?

PCP mis-selling occurs when the sales process does not meet regulatory standards. This may involve a lack of transparency, inadequate affordability checks, or sales practices that prioritise commission over suitability.

Common PCP Mis-Selling Issues

Mis-selling Issue	What Went Wrong	Why It Matters
Balloon payment not explained	Customer unaware final payment was required	Misleading understanding of ownership
Total cost unclear	Focus placed on monthly payments	Breach of transparency rules
Poor affordability checks	Income and ongoings not assessed	Risk of financial harm
Mileage penalties not disclosed	Excess charges not explained	Unexpected costs
Commission-driven sales	Product recommended for commission	Conflict of interest concerns

Regulators expect lenders to ensure customers understand the financial implications of the agreement at the point of sale.

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Who Can Make a PCP Claim?

Eligibility depends on how the agreement was sold, not on whether the finance is still active or whether the vehicle was kept.

Claimant Type	Can They Claim?	Key Notes
Individual consumer	Yes	Must be a personal agreement
Joint agreement holders	Yes	Each name party may have rights
Agreement ended	Yes	Ended agreements can still be challenged
Agreement still active	Yes	Ongoing payments do not prevent claims
Deceased estate	Sometimes	Subject to evidence and time limits

If you are unsure whether you qualify, you can still check your eligibility using the claim calculator.

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Which Lenders Are Commonly Involved in PCP Claims?

PCP finance has been provided by many high street banks and specialist lenders. Claims frequently involve providers such as:

Barclays
MotoNovo Firstrand Bank
Close Brothers
Santander
Blackhorse Lloyds Banking Group

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How Are PCP Claims Assessed?

Once a PCP claim is submitted, the lender will review the circumstances of the sale, including disclosures, affordability checks, and communications.

PCP Claim Process Overview

Stage	What Happens	Typical Timeframe
Complaint submitted	Claim raised with lender	Immediate
Lender investigation	Review of sale and documentation	Up to 8 weeks
Outcome issued	Claim upheld or rejected	Within 8 weeks
Escalation	Referral to Financial Ombudsman Service	Several Months
Resolution	Compensation or redress applied	Case dependent

If a lender rejects a claim or does not respond within eight weeks, it may be escalated to the Financial Ombudsman Service, which independently assesses whether the agreement was sold fairly.

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What Compensation Might Be Available?

Compensation varies depending on the facts of each case. Outcomes may include:

Refund of interest and fees
Reduction of remaining finance balances
Additional financial redress

The objective is to place the consumer in the position they would have been in had the agreement been sold correctly.

You can get an initial indication using the PCP claim calculator.

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About PCP Missold

PCP Missold specialises in PCP finance mis-selling claims. Our approach is evidence-led and based on regulatory standards, ensuring claims are presented clearly and accurately to lenders.

Learn more about us here:
https://www.pcpmissold.co.uk/about-us

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Frequently Asked Questions

What is a PCP claim?

A PCP claim is a complaint made when a Personal Contract Purchase agreement was mis-sold, usually due to poor disclosure, affordability issues, or misleading sales practices.