Martin Lewis: Car finance mis-selling help – your questions answered

Listen: Martin answers your car finance mis-selling questions

Below is a transcript of what Martin said, though we've condensed it slightly in places so it's easier to read.

What's the latest on car finance mis-selling?

Martin: There is only one story in town today when you live in my world, and that is car finance mis-selling reclaiming. 14 million car finance arrangements are said to have been mis-sold. It's going to be an average payout of £700 per person. It's going to affect huge swathes of people across the country.

I should caveat – we've just learned all this. There's one bit of information that I had been saying that is different this morning [Thursday 9 October]. It is changing all the time. We're not fully there yet. So we've dotted as many i's and crossed as many t's as we can. There is a still a little bit of wriggle room to be given here.

BBC Radio 5 Live presenter Adrian Chiles: Okay, so, right. I've got lots of listener questions or information we need – what is the latest update?

Martin: So what has happened this week is the regulator, the FCA [Financial Conduct Authority], has announced its proposed redress scheme. So there are two ways to get redress on car finance mis-selling. One is go to court, and the other is go via the regulator.

And that means you won't have to go via the Ombudsman. And the regulator is going to set up this scheme at some point in early 2026. What it's announced is what it plans to do. It's put that out for a consultation – the consultation launched the other day.

When they say 'consultation' at this stage, what that really means is: 'this is what we're doing, we legally have to give a chance to firms and consumer groups to have their say on it. We are very unlikely to change any of the major points, but there might be a little bit of wriggle room around the edges'.

So, for example, we [Martin and the MoneySavingExpert.com team] will be replying to the consultation. One of the things we're concerned about is when firms have to communicate with you, they may be seen as scams. How do we make sure that doesn't happen? So it's the edges that will be moved, in the main, rather than anything too material.

The easiest way to get money back will be through the regulator's new scheme

Martin: So, and I really want you to understand, when I say the court and going through this route – what the regulator has done is pretty unprecedented in the way that this is going to operate. It's estimating up to £8 billion will be paid out. And this is the easiest form of redress scheme I have seen.

So for people who have been mis-sold, this is going to be the easiest way to get money back. If you look at the amounts, I think there has perhaps been a small compromise on the amounts that people will get to stave off firms doing a judicial review to stop the regulator.

So there is an argument that if you were to go through the court route – though you'll probably need a lawyer or a claims management firm to do that, and they will take 30% of what you get, and you'd have to be more aggressive, and it's not guaranteed, and there are costs there – there is a chance you would get paid out more.

But for where I sit on this, most people when they get in touch with me, all they're saying is: 'when is this going to happen? Am I going to get my money? I've been waiting so long. I just want this to happen, and I want it to be simple'.

And the regulatory route is providing an easy, simple and relatively quick route from this point onwards for people to get their money back. So that's the one I'm going to be talking you through.

There are three types of mis-selling being looked at

Adrian: Okay, can I ask you a very basic question, what is the original sin?

Martin: There are three original sins.

1. 'Discretionary commission arrangements (DCAs)'

Martin: When this first started in January 2024, the main type of mis-selling I was talking about – and, you know, I've got 3.25 million complaints through my template letter on this – was discretionary commission arrangements.

That's where you went to a dealer or broker to get your car and they increased the interest rate that you would be charged in order to get more commission. So you were charged a higher interest rate so they got more commission.

That was done, as with other types of mis-selling, without telling you. If you were told – and you very rarely were – you weren't mis-sold.

But if you were NOT told you were on a discretionary (and that's the key word) commission arrangement, and your interest rate was increased, that is deemed to have been mis-sold to you. Because you should have been notified why your interest rate was being increased and it's deemed to be uncompetitive. That was the original sin.

And there are 11.5 million mis-sold DCAs on PCP [personal contract purchase] and HP [hire purchase] deals between April 2007 and January 2021. Now, people are going to say, 'hold on, I thought you could go up to November 2024' – because they've heard me say that elsewhere. But on the DCAs, they stopped in January 2021; they were banned. So if your claim is on a DCA, it's only up to January 2021.

The other two types of mis-selling come from a Supreme Court case

Martin: Then we have this case that went through the Supreme Court. And initially the Supreme Court was basically saying that car dealers had a right to protect you and look after [you] and they were acting as your agent, and if they hadn't acted as your agent properly, you were mis-sold. That was when it was going to be enormous amounts of payouts for even more people.

The Supreme Court squashed most of that and said they weren't effectively acting as your agents. They didn't have that responsibility. But within that judgment, there was a Johnson case that it did uphold. And the Johnson case brought up a number of different issues.

One was the level of commission, how high the commission was, and the other was, were they actually pretending that you were being given the best deal from across the market, but you weren't really.

So those are the other two sins that people have been mis-sold by that are coming in the regulatory process. So you understand discretionary commission arrangements. Let's do the other two now. Let's go through what the sins are...

2. 'Contractual tie'

Martin: The next one is a contractual tie. So what happened here – and this happened in the Johnson case – is you went to get your car finance, and they effectively said something like, 'yeah, we're going to go and find you your best deal from a panel of lenders'.

But they didn't go to a panel of lenders. What they did is they had one lender who had a first call, so if that lender wanted your custom, that's the loan that you were given, rather than there being a competitive market.

Adrian: They weren't testing the market.

Martin: So they weren't testing the market, having indicated to you that they were. And if they didn't disclose that to you, then you were mis-sold due to a contractual tie. That is 3.2 million arrangements. DCA's 11.5 million, this is 3.2 million.

3. 'High commission'

Martin: The third one is where it is deemed – and again, from the Johnson case at the Supreme Court – that the commission was so high in its own right that it was a market distortion. Now this comes at two different levels of commission:

• The first is: if the commission was over 35% of the cost of the credit and over 10% of the total loan amount, it was deemed that, even if nothing else was wrong, unless you were told how high the commission was, you were mis-sold.

• The second level is: if it was over 50% of the cost of credit and over 22.5% percent of the loan value, then it was also deemed too high. But you actually get more compensation, and we'll come into the amounts of compensation.

There are 2.9 million 'high commission' cases.

So to run through all those:

• Discretionary commission arrangements: they charged you more interest.

• Contractual tie: they didn't tell you they were only really going through one lender in most cases.

• And unfair high commission.

Those are the three sins, as you call them, that people are due to get money back.

The three types of mis-selling may overlap

Martin: Now some may go, 'hold on. You've just got about 17, 18 million cases. I thought you said there were 14 million?'. That's because, in some cases, there was more than one of them. If there was more than one of them, you still only get the same amount of compensation – it's worth saying that.

And it's also just to note, and we'll come on to more of this in detail. If you've complained about one of them – and the vast majority of people who've complained so far have complained about discretionary commission arrangements, because that's what my template is, and that's 3.25 million complaints; we hear there's 4 million overall, so it's the majority of them – then the regulator is telling firms they must still look at the other two automatically. They must consider them, even if you haven't complained about them.

So hopefully that's giving you a start to see what the mischief that's trying to be solved by the regulator is.

'Should I put in a complaint now? What happens next?'

Adrian: Okay, so Jodie asked: "How do we know whether to put a complaint in or not? What are the next steps for those who aren't very clued up on this stuff?"

Martin: If you haven't put a complaint in, we need to go through what is going to happen. If you haven't put a complaint in, what the firms are supposed to do, once the redress scheme starts sometime in early 2026, is they are supposed to identify everybody they believe has been mis-sold.

You will then be contacted within six months of the start of the redress scheme, and you will then have a choice to opt in to a complaint. (They're calling it a letter, but that hasn't been defined yet; whether it's a letter or an email, or what form of contact.)

So that's the point. You will then have to say, 'I want to be part of the complaint', because they've identified that you were mis-sold.

If you have already complained by the time the redress scheme starts, then you will be contacted and you have to opt out, so you will automatically be in the complaint scheme unless you choose to opt out. Ask me in a moment why some may choose to opt out. That's important.

The reason I'm phrasing it that way – my view, and when I was talking to the boss of the regulator on this the other day, he agreed – is you would be better to be in the cohort of people who have complained, and therefore it will happen unless you opt out, than in the cohort of people that they have to contact and you have to opt in.

So my view is that people should be putting in a complaint now before the scheme starts, so that you're in the right position. You're in the 'opt out', not the 'opt in'.

But – and I'm going to be really blunt here, and I hope I'm not breaching rules by saying this – the template letters that I have on my site only talk about one of the three streams of complaining at the moment.

And they also only include the firms that had offered discretionary commission arrangements, because there are some firms that didn't. We, over the next few weeks, are working to change the letter and add all the other firms into the automatic complaint process.

There's no harm waiting a month or so

Martin: There is no harm in waiting a month or so because you don't need to use a claims firm for this, because this is all going to be automatic. I mean, there's just no point. [Since] there's no harm in waiting, I would sit on your hands for about a month or so and let us, and other people who are doing similar things, get all our ducks in a row to get this right for you.

Because now we know what the redress scheme is, and we have strict dates on the redress scheme: so it is for PCP and HP deals between April 2007 and November 2024. Obviously, DCAs are earlier, but contractual mis-selling and unfairly high commission could be up to November 2024. There is no harm in waiting, as long as you get this in before the redress scheme starts some time in the beginning of next year.

So probably the best thing to do is to put a complaint in. The easy way to do that is to use one of the free tools that are out there, including the one that I have. But those free tools aren't quite up to speed yet, so you may as well wait a month to do it then. And we can talk about that again in a month's time. So that is my answer: yes, put a complaint in if you had a PCP or HP deal between those times.

'Why are you encouraging everyone to complain?'

Martin: Some may be saying, "Hold on, not everyone was mis-sold. Why are you encouraging everybody to do it?" And here's why: because all those three sins; discretionary commission arrangements, contractual tie, and unfairly high commission, the big sin is that you weren't told about them, so you do not know if you were mis-sold. You cannot find out if you were mis-sold without asking, 'was I mis-sold?'. That's the whole problem here.

So it isn't [that] I'm just encouraging everybody to do it, even if they weren't mis-sold. Actually, the premise of the template letter we've drafted, the primary premise, is to say, 'did I have a discretionary commission arrangement?'. And it will also be saying, 'was I contractually tied, and how high was my commission?'. Because none of that was disclosed, and that's the sin.

So the only way – you have to do the search, the discovery, before you do the complaint, and that's what the letters do.

'If my loan was interest-free, do I still qualify?'

Adrian: A couple of questions come in, tell me to ask you this later if it gets in the way. A couple of people, John in Woodside Park and Richard in York are both asking: "if the loan was interest-free, do I still qualify?".

Martin: No.

'Does this cover lease contracts and business vehicles?'

Adrian: Right, okay. And a couple of people, Toby in West Sussex [for example], are asking: "Does this cover lease contracts?"

Martin: No, only PCP and HP.

Adrian: Okay, and not business?

Martin: No, this is consumer. Well, the definition of business is interesting. If you bought it and it wasn't primarily for business use, then you can do it. So there's a commuting, sort of crossover in there – how much of it was for business? I mean, if you've gone and bought a truck for your limited company, no. Right? But if you've got a hybrid-domestic-van-thing, then maybe, yes.

'Why would anyone opt out of the scheme?'

Adrian: Okay. I've got to ask you that thing. So if they come to you and they ask you whether you want to opt out of something. Why on earth would you do that?

Martin: I go back to how I started this in the first place. There are two routes for doing this: the FCA route – the regulatory route – is the easy, simple, quick, no-hassle route. The more militant route is going to court. You may decide at that point that you think you're going to get more from going to court and you feel competent and capable to do so, and you are willing to have that fight. That is not a judgment I will make for people.

I'm mainly going to be focusing on the FCA route. But if you chose to do that [go to court], then you need to opt out of the FCA system. It's worth noting, if you do opt out of the FCA system, you cannot opt in again, so it's a one-time only decision that you're making.

So you go out of that and then you say, either 'I don't want the money, because I don't think I've been mis-sold', and maybe there are some people who have that on a principle decision. Or 'I'm going to go and do this myself, and I'm going to go through the court route'. And if you want to do that, that's why you have the chance to opt out, because you might say you wanted to do that.

And I'm not saying it's wrong, but it's not the route I will be supporting. Because of listening to my listeners and having done PPI and having done bank charges and similar things in the past, the huge majority of people who are following the type of stuff that I do and want help, they just want easy and simple.

'I've put in a complaint – do I need to do anything else?'

Adrian: Hannah sent an initial complaint and has a complaint reference number with the company. Does she need to do anything else? Or will she automatically be receiving the compensation?

Martin: Assuming she was mis-sold, she will be contacted at some point in early 2026 – maybe March, April, May, as I've said. And they will then say, 'we plan to pay you this amount of compensation. If you want to do that, you don't have to do anything. But if you don't want to be withdraw from that, you will need to opt out now'. So no, she doesn't need to do anything more.

Adrian: Joe says: "If you already contacted the finance companies regarding DCAs using your template, are we also now required to submit emails regarding the other two scenarios?".

Martin: No. The regulator has confirmed, if you have put in a complaint already about a DCA, then firms will automatically have to assess you for a contractual tie mis-selling and an unfairly high commission mis-selling as well.

So, if you have put in a complaint, you are done. You just sit on your hands and wait [until] what will probably be, my guess is, you're probably going to get contacted maybe March, April, May 2026. And you will be asked to opt out if you were mis-sold, and if you don't opt out, then they're going to pay you.

'The car finance firm hasn't responded to my complaint – is this normal?'

Adrian: Ian in Grantham says he's emailed Toyota twice using your template for asking about car finance mis- selling. "I've not had any response. The first time we [sent a complaint was] shortly after the template went live, and then the other one [we sent] a few months ago. Is this normal for Toyota?"

Martin: Generally, what you want at least is to have had an acknowledgement of your email, even if they don't say anything, and then you're in the system and it counts. Better is: many firms have written back and either said – because it was only about discretionary commission arrangements – you did have a discretionary commission arrangement, or you didn't have a discretionary commission arrangement.

Adrian: Okay, but, I mean, should he be worried? What should Ian do?

Martin: No, the truth is, as long as you sent it, I mean, you used my tool, and it automatically sends it to the right address. And we have checked that, we talked to each individual lender before we did that about what the right contact address is, so they have it logged. It just sounds like poor admin on their side.

And no, you shouldn't be worried, because they are legally obliged to contact you anyway. But yes, you should be absolutely frustrated and a little bit annoyed about it.

'Is it £700 per agreement or in total?'

Adrian: Andy in York says: "Is the £700 per claim, or is it a one off payment? I had approximately six cars during that period, and wondered if I would get 6x £700."

Martin: Every individual claim is separate. So if you had six arrangements, six different car finance deals – even if it was with the same company – and they were all mis-sold under one of the three categories of mis-selling, you would get paid for each one.

'How will the compensation be calculated?'

Martin: Let's just do that £700 number. Some people seem to have got the impression that it is a fixed £700. It isn't. That is the average payout that will be assessed. Now, here's how they're going to do it. This is really complicated, folks.

What the regulator has done to decide how much you'll be paid out, in the vast majority of cases, is worked out the loss it believes you had from the distortion of the market [when] you were mis-sold. And having done a calculation, it has come up with a figure of 17% of the interest that you were charged. That's step one.

Step two is: it also says 'what was the total amount of commission paid to the dealer or broker?', which is generally higher than 17% of the interest. Then what it does – I told you, it's complicated – is it adds up the total commission, and it adds the 17% of the interest together and divides by two.

So you effectively get a mean average of the total commission and the loss the regulator believes you have had. So you get more than the loss it thinks you've made, but less than the total commission.

Let me give you some examples, because I think that will help:

• So, the average payout for a discretionary commission arrangement claim, which is the majority of them, is going to be, according to the FCA, £666. If it had done it by the loss system, you would have only got £421. If it had done it by the commission system, you would have got £910. And it is a weighted average, so don't start going quite into the means. So you're getting £666, you're getting in the middle.

• For those who were charged a high commission, the average payout will be £1,100. If it [had] done it by the loss system, it would have been £452. If it had done it by the total commission, it would have been £1,765.

• For those who did a contractual tie, the average payout will be £686. If it'd done it by the loss system, it would have been £511. If it had done it by commission, it would have been £862.

So it is [a] pretty complicated formula that they are using to work out how much you get. Basically, they're going somewhere between the total commission that they got and the amount of loss the FCA deems you've got based on its calculation. There is a but though.

Adrian: Right, there always is.

Martin: So that's for the vast majority of cases. Then do you remember earlier I said there was a specific case of extremely high commission, where it was over 50% of the cost of the credit and over 22.5% of the [total] loan. In those specific circumstances, because the court set a precedent on that, under the Johnson case, and the court awarded ALL the commission to be paid back, and the interest.

In those circumstances, the regulator will give you all the commission and interest. To put that in perspective, they're estimating that's 13,000 or 14,000 cases out of a total of 14 million. So it is not a very likely chance.

But, overall, I mean, to cut that all short, most people are going to get an average of £700. And you get interest on top. Although the interest rate is way too low, in my view; it's the bank base rate over the period that you were owed, plus 1%. [It] used to be a statutory interest of 8% non-compounding a year. We are putting in the consultation, we think this change is too low. But they're also doing that at the Ombudsman as well.

So there we go.

'Can I claim for more than one agreement?'

Adrian: Okay, Robert in Inverness. We've sort of covered this, but go on, Robert. How are you doing?

Robert: Yeah, good afternoon, gents. I think you've just touched on it there, but my question was, can you claim for numerous agreements? And if you can, do you need to do them individually?

Martin: Yes, every agreement is separate. Are they individual agreements with the same car finance firm or with different car finance firms?

Robert: I think I've got three, and I believe that two of them are different finance firms.

Martin: So, clearly, the one you just do as a complaint in its own right. Where you've got two, you can combine them. You just need to make sure – you know, when you're doing these complaints, the more information you give them, the better.

If you have both policy numbers and for what the car registration is for each car, and you put those in your complaint letter, you can just do one complaint letter for both. But just make sure you're detailing the separate policies in them, and that's no problem.

So it's a pretty easy system. And again, hopefully, and you've been listening along. Hopefully, the concept here: you don't have to do anything, even if you haven't complained. What should happen is the car finance firms will identify that you've been mis-sold and they will communicate to you.

My view is you'd be better off complaining now, because then they've definitely got notice of you, they've definitely got your up-to-date address. And you'll be in the opt out system. It's not compulsory, though. But the fact that you're listening to this, and interested in it, tells me you're the type of person who should be putting a complaint in, because you want to be on it.

Robert: Yeah, that's the plan.

Martin: Alright, good luck to you.

'How do I know if I was mis-sold?'

Adrian: Let's say, hypothetically, somebody who looked and sounded exactly like me, bought a car in January 2024 on PCP. So how would I know [if I was mis-sold]? All I remember is signing about 200 different pieces of paper.

Martin: January 2024?

Adrian: That is when a car was registered, yeah.

Martin: Okay, good, because that's quite useful to explain the dates. There are three different dates that are relevant here. You've got April 2007, which is the furthest that you can go back. You've got November 2024 which is the most recent you can go to. And you've got January 2021, which is when discretionary commission arrangements were banned, so you did not have a discretionary commission arrangement.

So that's one of the three categories of mis-selling gone.

You may have been contractually tied. In other words, they may have told you we're getting from a whole group of lenders, but really only go to one lender. You may have had unfairly high commission. How do you know? You don't. That's the whole point. This is all about undisclosed mis-selling. If you were told, you weren't mis-sold. So if you weren't told, the only way to find out is to ask: were you contractually tied when you sold me?

Adrian: But what does 'told' mean, because I was given, I signed 100 pages of paper.

Martin: Was it in your documentation, did they tell you?

Adrian: You couldn't possibly read through all of that.

Martin: No, no, but let's just go back again. If you remember, I said there are two routes. There's the court route; the difficult route, then there's the easy, simple route.

The easy, simple route is that these firms, effectively, the regulator is saying, 'you have to behave in a certain prescribed way'. And there is some compromise in my view to this. And I said the other day, when I was being interviewed about what's going on, I want these firms to accept this and not fight this by judicial review.

If they accept it and not fight it by judicial review, certainly I, and I can't speak for other consumer groups, will accept it and suggest people use this route.

If they go militant and try and fight it, then I might start saying people need to go to court, which they will not want. So, the reason I'm making that point is, under this system, you don't need to go back through that paperwork.

The companies have to go through their paperwork and documentation about what was done and what was not done. You ask: 'Was I contractually tied? How much was my commission? Is it over the unfair commission barrier?'. You write them a letter, and you ask them that.

That's what you need to do, and that is why we have a regulatory redress scheme, because there is clearly a misbalance of power between Joe Bloggs – or Adrian Chiles – buying a car, and huge car finance firms with 30 pages of legalese that nobody understands. That's why you have a regulatory redress scheme when what was happening is there was a sneaky way of mis-selling, by the way, that they were operating over the years.

'I've signed up to a claims firm – what happens now?'

Adrian: Hayley: "What happens if you already put your claim in via a third party, they're taking a percentage. So would the £700 go via them?"

Martin: Okay, this is a big question, and this is one that we are planning to do some more work on. Many people went via claims firms. If you're going to go the court route, I can see why you would do that.

But as I have been warning for at least a year, we were likely to see a simple system put in by the regulator that does not need you to be paying anybody to do it for you. So we're now in a very interesting position that we have quite a lot of people – because of the huge amount of marketing and advertising – that went through claims management companies.

We had a warning put out by all the regulators that cover those claims management companies and law firms the other day about misleading claims that may have been put in by those firms.

And effectively, what's being said is, some of the firms say you must have an exit fee. If you decide to opt out and not go through the firm, then you pay an exit fee. One of the big problems with that is those exit fees are often payable immediately. So if you contacted the firm now and say, 'actually, I don't want you to do this for me. I'm going to opt out. I'm going to do it myself, so I don't have to give you the commission because it's easy'.

Well, you may have to pay them an exit fee now, under the contract that you signed with them. What the regulator is saying is you should only be paying for work that has been done. So if they're not going to be doing very much work for you, they shouldn't be charging you the full fee.

When we ask them how much you should be charging or exactly how this works, we get: 'we're not there yet'. And so my answer is going to mirror it to an extent.

Over the next few weeks, we are going to be working on what the situation is for people who've signed up to claims management firms and the claims management firm is not going to be doing anything for them. But it is currently a vague and a grey area. And claims management firms, by definition, are litigious firms, because that is what they do. And this needs to be worked out.

I think certainly you did sign up to them. If they're going to charge you an exit fee, if that's fair and reasonable, because they probably have done some work already, then you're going to have to pay it, and you're going to have to work out, you know, which adds up best for you.

And if they have done work for you, you're going to have to pay them within what was contracted for the work that they have done. But they may not have done much work for you, as it's all been on hold for a while.

So we're in a grey area on that one at the moment, and it's something that that we will be doing more work on, and we will be pushing. If you wanted to complain to the firm, by the way – just so everybody knows – if you do complain to the firm and you don't like what you get, then you have a right [to escalate your complaint].

If it's a claims management firm, under most circumstances, go to the Claims Management Ombudsman, which is part of the Financial Ombudsman. But if it's legally regulated under the Solicitors Regulation Authority, then you go to the Legal Ombudsman. So you have to find out which type of firm it is, too, because there are two different regulatory processes for claims management firms.

'What if I can't remember whether I've complained or not?'

Adrian: Ryan says: "Within the window, I've had a total of six cars on HP or PCP. I think I've submitted a letter at least once, to one of them. How can I check this? Or should I just resend a letter to all? Or should I send three letters to all to ask about the three types?"

Martin: You don't need to ask about all three separately – if you have complained about one type, they have to consider all three types. So you don't need to do any more. So let's write that one off. If you don't know if you've complained, well, it's very tough to know, to know what to say other than, well, if you're not sure, you might want to put a complaint letter into all of them.

If you're telling me you don't remember who your agreement with it is, that is a different matter. Again. Let's just go back to the process – two-step process. One for people who've complained – you'll get an opt out. One for people who haven't complained, but the firms have discovered that you were mis-sold, you will be contacted anyway. So the cost of not complaining isn't huge.

I think it slows things down. It's bit more bureaucratic, and they might not have your current address, so you're better off to complain, but it's not a huge amount.

'I've been told I didn't have a DCA – what now?'

Adrian: Okay, Simon says: "I put in a claim when you first highlighted this, using your form. VW Finance came back and said, I wasn't eligible. Does this change at all with this recent ruling?"

That's the bit I don't understand. You might say – and no disrespect to VW or anyone else – but if they come back and say, 'you're not eligible', well, you would say that, wouldn't you?

Martin: Well, no, because what they asked, what the letter asked, is: did I have a discretionary commission arrangement? So there were two types of firms. There were firms that didn't do discretionary commission arrangements at all, and firms that did sometimes do discretionary commission arrangements. So VW Finance was one of those that sometimes did it.

So if you've complained to them, they've said you haven't got a discretionary commission arrangement. One would hope that the regulator is absolutely on top of this and will be spot checking that there will be veracity in the information, but now it means you still may have been mis-sold via a contractual tie or unfairly high commission.

But the fact that you have put a complaint in means you have put a complaint in, and therefore they will have to investigate those and you will be in the ['opt out' letter category]. In other words, where they'll just tell you if you've been mis-sold, and you don't have to do anything. So you will be in that category, which it works that way.

'What if the car finance firm is no longer in business?'

Adrian: "What if the company used for your finance is no longer in business? I have two agreements, which Santander has confirmed at DCI on and this other one from 2007."

Martin: I'm sorry, is the answer. You cannot be part of the regulatory process for a firm that has gone bust. So if the car finance firm is bust, you are not going to be paid out via the regulatory process. Now, maybe, arguably, if there were liquidators to that firm, and you would be a creditor of that firm then, and you were to take the liquidators to court that you were owed the money on the back of it, you might get some money on the back.

But you still can't go via the liquidation process, via the FCA. The FCA redress scheme is only for firms that are still trading. Now, if another firm has taken over that old company's liabilities, you may be able to. But basically, for most people, if you want a simple and easy life, if the firm you got your car finance with has gone bust, you're not getting anything being straight.

'Can I complain on behalf of someone who's died?'

Adrian: Okay. And Gareth says: "My dad took finance out in a car in 2010 but has passed away." Can his mum still make a claim?

Martin: Yes. The person who is the primary beneficiary of the estate is eligible, and the firm should be contacted by the executor of the estate or the primary beneficiary of the estate, with proof of who the primary beneficiary is, in order for that claim to be pursued. I would say, in those circumstances, I would strongly push you to put a claim in. Because, clearly, it gets much more difficult.

'I have an old agreement – what if I've lost the paperwork?'

Martin: This is really interesting and difficult and complicated. Clearly, if you've got a car in the last six or seven years, you've got all the details. Even if you paid it off, credit reference agencies keep details of active lending for the last six years.

So 'active lending for the last six years' means even if six years ago was your last payment month for a car finance you got out five years before that, it'll still be on the credit reference file. You've got data. You hopefully have documentation, and you've kept documentation, it's fine.

And the firms themselves are being told to turn over every stone to find out all the details of who had these car finance agreements and check them. And I'm hearing, and I haven't got this confirmed, there is access to credit reference agencies of more than six years' data that the firms will be able to access. But I haven't stamped that yet, so I may be wrong on that. We're looking at whether that's possible.

So the firms will need to identify. But let's be really blunt, if we start going back to 2007 to 2012. You know, you're talking 13 years ago, it's much more difficult. And there is a high plausibility that, even if you had a car finance deal, the firm will not know that now, because they do destroy records, and they are often encouraged through data protection to destroy records.

So what happens in those circumstances? In those circumstances, the best thing to do is you have to find some evidence that you had car finance with them at that time. Now that evidence could be an old credit reference file of yours. It could be an old bank statement that shows you were paying them – even better if you had the original agreements.

It's interesting, because when we talk about how long you keep documents, for the standard advice is you keep your statements for six years. I wrote a blog 10 years ago saying I disagree with that. I would keep records of every agreement you've got, because we don't know what the next PPI will be.

Adrian: And here it is.

Martin: And here it is. And you should keep those documents, keep them on your computer, in a file, just have them somewhere that you could go back and search them. And that's future-proofing advice, by the way, now for everything else that's out there. I'm not saying you need to keep every bank statement, but every loan and agreement you sign up, try and keep a record of it.

Now if you have any data going back to that time, then I would make a complaint, even with the scarcity of data. This was the registration number, and I know I bought it through your firm.

What the regulator will likely do – not confirmed yet – is, even if there are scant details, it will look and it did this in PPI, and say, "were people who were getting the type of loans that you were getting at that time in the same circumstances, systemically being mis-sold in this way? If they were, then we will assume that you were mis-sold in that way. If they weren't, we will assume you weren't mis-sold in that way'.

So even scant details from the early period may be enough to get the claim through. But if you have no details, and it's old, and the firm has no details, then nothing's going to happen. And you just have to say, well, you know, that's it.

'I've moved house – how will the car finance firms contact me?'

Adrian: Jim in County Tyrone said: "If I haven't complained and I wait on the finance company to proactively contact me, how will they do this if I've moved house?"

Martin: Well, they should try and find your latest address. But I presume we are going to be saying and going to be campaigning out there for everybody to update with the finance company if you have moved address, because they may not have it.

What I'm suggesting you do is you contact and put a complaint in, then they have your address, and you include your old address, and you include the car details. This is why I'm saying you want to be in the 'I've complained' group.

You don't want to be in the 'I've not complained' group, because while it should work, there are clearly going to be people who fall by the wayside in that group. So you're asking me what to do? Put a complaint in. Tell them your address. Okay, that's my answer.

'Are motorcycles covered? What about other vehicles?'

Adrian: Laura wants to know if this all applies for loans for a motorcycle.

Martin: Yeah, this is for any motorised vehicle bought as a domestic or a consumer purchase, not a business purchase. So, motorcycle, yes. Motorhome, yes. Domestic use van, yes. Car, yes.

Adrian: But if you're a self-employed decorator, and you buy a van?

Martin: Then, if it's for business use, it's for business use. The more important point I was about to make, the one everybody asked me – caravan, no. Caravans do not have motors. Therefore, even if you bought a caravan on a similar type of deal, it is not included in this scheme. Motorhome, yes. Caravan, no.

Adrian: Got it, because [a] caravan's got no motor.

Martin: This is about, this is actually 'motor vehicle' compensation – I call it car finance, motor vehicle finance compensation is technically what it is.

'Has the compensation amount changed?'

Martin's answered this question separately in his new blog: Why the likely car finance mis-selling payouts look less than they did.