Drivers could receive a multimillion-pound payout sooner than they think for overpaying on interest rates when purchasing a vehicle between 2007 and 2021.
More than 1.2 million complaints were flagged by drivers to Martin Lewis and his Money Saving Expert website thanks to its car finance tool which could show whether they had been overcharged during the period.
The site has averaged roughly 30,000 complaints per day from angry drivers who are demanding compensation for the money they may have lost when paying larger rates of interest.
Drivers overpaid through the discretionary commission arrangement (DCA), which was rarely publicised to consumers, meaning they were paying more than necessary.
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Martin Lewis said the response to the MSE car finance tool had been 'off the charts'
PAUnder DCA schemes, drivers were charged more each month for car repayments which went straight to brokers and car dealers who received the money as commission.
Martin Lewis, founder of Money Saving Expert said: “It's been a little over a month since we launched the tool and the response has been off the charts.
“So no surprise I'm now swamped with enquiries from people about what their response means. On the back of it, we've been doing some detailed work.”
In an update, Lewis explained how Lloyds, which owns Black Horse, a car loan company, has already put a £450milion “provision” towards potential costs and payouts.
Speaking last week, the CEO of the Financial Conduct Authority said it's improbable that its investigation will find no evidence of wrongdoing, but this won’t be confirmed until it reports in September.
Lewis added: “The numbers of complaints are beyond anything I expected, and I expected far bigger numbers than most firms did.
“As they hadn't planned for this scale, it's unsurprising many are struggling to respond in a decent time.
“There's no point in going in hard if they simply don't have the capacity to do it any quicker, so below I explain when to push and when not to, to 'deliver' a result.”
The financial advice website provided guidance about what to do to contact big brokers for people who had used the MSE tool.
The site found that if the driver used Black Horse to purchase a Jaguar, Land Rover or Suzuki, which 16 per cent of complaints were about, they should receive an acknowledgement email straight after contacting and a response within 28 days.
Volkswagen Financial Services including Audi, Seat and Skoda, which had 14 per cent of complaints, should send a response within six weeks.
Motorists who purchased a Hyundai, Kia or Volvo through Santander can expect a response within 28 days, with eight per cent of MSE complaints flagging these as issues.
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More than 1.2 million complaints were flagged by drivers using the MSE tool
PAAccording to MSE, BMW Financial Services takes 88 days to reply while other companies such as Stellantis and Mercedes-Benz Financial Serviceswere highlighted as having “no solid guidance” on when affected drivers would receive an acknowledgement.
