Car Finance Claim for Young Drivers and First Cars
Scheme status (updated 5 August 2026): parts of the FCA motor finance redress scheme are temporarily suspended while the Upper Tribunal considers legal challenges. Lenders do not currently have to calculate or pay compensation under the scheme, the original decision and payment dates no longer apply, and no payment under the scheme is guaranteed. If the scheme proceeds, first payments are expected in 2027 at the earliest. Any dates mentioned below were set before the suspension.
If you bought your first car on PCP or Hire Purchase between 2007 and 2024, you are just as eligible for compensation as any other driver — and you may have been particularly affected by commission mis-selling. Young buyers were often the least informed about how car finance worked, and the most likely to trust a dealer’s recommendation without questioning the interest rate.
In this guide
- Age Is Not a Barrier to Claiming
- Why Young Buyers Were Particularly Vulnerable
- The Johnson Case — A Young Buyer’s Story
- How to Make a First Car Finance Claim
- Frequently Asked Questions
- Related Guides
- Our Partner's Fees Explained
- Think You May Have a Motor Finance Claim?
Age Is Not a Barrier to Claiming
There is no minimum or maximum age requirement to make a car finance claim. If you were 18 or 19 when you took out your first PCP or HP agreement, and that agreement falls within the FCA scheme dates (6 April 2007 to 1 November 2024), you are eligible.
In fact, the FCA’s own analysis of unfair relationships specifically considers the sophistication and information available to the customer at the time. A first-time car buyer at 18 with no prior experience of credit agreements is in a demonstrably weaker position than an experienced buyer — which supports, rather than undermines, a claim.
Why Young Buyers Were Particularly Vulnerable
Consider a typical first-car purchase. You are 18 or 19. You have just passed your test. You need a car. You walk into a dealership, find something you can afford monthly, and sign the paperwork. The dealer presents the finance as the obvious solution — and you have no reason to question it.
What you were almost certainly not told:
- That the dealer was choosing your interest rate from a range
- That the higher they set it, the more money they earned
- That you could have had a lower rate from the same lender
- That the ‘best deal for you’ pitch was compromised by the dealer’s own financial incentive
This is not a failure on your part — it is precisely how Discretionary Commission Arrangements were designed to work, invisibly. Young buyers were particularly exposed because they had no frame of reference, no prior finance agreements to compare, and were entirely dependent on the dealer’s guidance.
The Johnson Case — A Young Buyer’s Story
The pivotal case that led to the FCA’s £7.5 billion scheme was brought by Marcus Johnson — who bought his first car, a second-hand Suzuki Swift, from a dealer in 2017 using HP finance through MotoNovo. He was a young driver. He had no idea the dealer had set his interest rate at a level that earned them more commission. The Supreme Court’s judgment in Johnson v FirstRand Bank in August 2025 found in his favour — and created the legal foundation for the entire nationwide scheme.
How to Make a First Car Finance Claim
Step 1 — Check your dates
Your first car finance must have been between 6 April 2007 and 1 November 2024 to be within scope.
Step 2 — Find your agreement
If you were young at the time, you may have moved address several times since. Claims Bible traces agreements by your name, date of birth and address history — you do not need the original paperwork. See: Claiming Without Paperwork
Step 3 — Complain to the lender
The lender named on your original agreement — often visible on your credit report even for very old agreements — is who you complain to. The dealer you bought from is not the lender.
Step 4 — Use Claims Bible
Our free agreement finder covers agreements going back to 2007. No paperwork needed. If you took out your first car on finance through a small independent dealer, your lender may be a smaller or specialist finance company — Claims Bible can identify the correct entity to complain to.
Frequently Asked Questions
I was 17 when I took out my first car finance. Can I claim?
You must have been 18 or over to enter a regulated credit agreement, so a valid car finance agreement would have been at 18 or older. If the agreement was in your name and you were under 18 when you signed, it may not be a valid regulated agreement — take advice on your specific situation.
I took out my first car on finance in 2019. Is that still eligible?
Yes, provided the finance was PCP or HP arranged through a dealer and met the standard criteria. The FCA scheme covers agreements up to 1 November 2024, so 2019 is well within scope.
I had a guarantor on my first car finance. Does that affect my claim?
No. The claim relates to how the finance was sold to you, not the structure of the guarantee. If the dealer received an undisclosed commission that affected your interest rate, you have grounds to claim regardless of whether a guarantor was involved.
I have had several cars on finance since my first one. Can I claim for all of them?
Yes — each eligible agreement is a separate claim. If you have had three cars on PCP or HP finance since 2007, you could have three separate claims. Use our car finance claims calculator to estimate the combined value.
Related Guides
FCA Car Finance Redress Scheme Explained
Car Finance Claims Without Paperwork
Back to Car Finance Claims Hub
You will be redirected to our partner’s website to complete your claim.
Think You May Have a Motor Finance Claim?
The FCA estimates average compensation of around £830 per eligible agreement, but eligibility and payment amounts vary. Some customers may receive nothing. Complaints about agreements started from 1 April 2014 should be submitted by 30 June 2026 to be considered under the earlier timetable. Different dates apply to older agreements. The scheme is currently subject to legal challenge, so dates and payment timings may change.
