Can you claim for both PCP and HP car finance?
Yes. Both Personal Contract Purchase (PCP) and Hire Purchase (HP) agreements are within scope of the FCA's motor finance redress scheme, confirmed in Policy Statement PS26/3 (FCA, 30 March 2026). What determines a possible claim is not the finance type but whether commission was paid to the dealer or broker and how the agreement was sold. The scheme covers HP and PCP taken out between 6 April 2007 and 1 November 2024.
This is not a guarantee that you are owed money. You can complain to your lender directly for free and do not need a claims management company. The scheme is also subject to legal challenge, so timescales are uncertain (see below).
The 2025 Supreme Court ruling and the FCA redress scheme
Updated 8 June 2026. A lot has changed, and much of the older commentary on car finance claims is now out of date. Here is the verified position.
What the Supreme Court actually decided (1 August 2025)
On 1 August 2025 the Supreme Court handed down its judgment in Hopcraft, Johnson and Wrench ([2025] UKSC 33). The ruling mostly sided with the lenders. The court held that car dealers acting as credit brokers are generally not fiduciaries of the customer, and it dismissed the bribery and secret-commission/fiduciary claims, overturning the more consumer-friendly Court of Appeal decision of October 2024.
The court upheld only one, narrower claim — Mr Johnson's case — on the basis of an "unfair relationship" under section 140A of the Consumer Credit Act 1974.
This means there are no automatic, blanket payouts and the ruling did not confirm that all car finance was mis-sold. It is not accurate to describe the judgment as an outright "win for consumers". Instead, redress is being handled through a separate, FCA-run scheme.
The FCA redress scheme (Policy Statement PS26/3, 30 March 2026)
On 30 March 2026 the Financial Conduct Authority confirmed an industry-wide redress scheme in Policy Statement PS26/3. Key points (FCA, 2026):
- It is industry-wide and free to use.
- It covers car, van, motorbike and campervan HP and PCP agreements taken out between 6 April 2007 and 1 November 2024 where commission was paid (the FCA splits assessment at 1 April 2014).
- It covers Discretionary Commission Arrangements (DCAs), other high-commission arrangements and undisclosed ties between dealer and lender — it is not limited to DCA-only cases.
- The FCA estimates around 37% of agreements are eligible (roughly 12.1 million).
- Once you accept an offer, the lender must pay you within one month.
- The FCA estimates average redress of around £830 per agreement (£829 in PS26/3) for those who qualify. Total redress to firms is estimated at around £7.5bn (around £9.1bn including costs).
The £830 figure is an FCA average per agreement, not a typical or guaranteed individual payout. It varies widely: around 1 in 3 eligible agreements are expected to be capped, and some people will receive nothing.
Important: the scheme is under legal challenge
A legal challenge to the scheme was filed around 1 May 2026, with an Upper Tribunal hearing unlikely before October 2026. The FCA has said this will delay payouts. For that reason, no one can give a firm timetable, and you should treat any "act now or miss out" messaging with caution — there is no hard consumer deadline being relied on here.
PCP vs HP: what is the difference?
PCP and HP are the two most common forms of UK car finance. They work quite differently, which affects your monthly cost and whether you end up owning the car — but, importantly, both can be the subject of a mis-selling claim under the redress scheme.
| Feature | PCP (Personal Contract Purchase) | HP (Hire Purchase) |
|---|---|---|
| Ownership at end | Only if you pay the balloon payment; otherwise you return or exchange the car | Automatic once all payments are made |
| Deposit | Typically around 10-20% of the car's value | Deposit usually required (often lower) |
| Monthly cost | Lower (you finance the depreciation, not the full value) | Higher (you finance the full value) |
| Balloon / GMFV | Yes — a large optional final payment based on the Guaranteed Minimum Future Value | No balloon payment |
| Mileage limits | Yes — excess-mileage charges can apply | No mileage limits |
| Typical term | Around 24-48 months | Around 24-60 months |
| Common for | New cars | New and used cars |
| Can it be a mis-selling claim? | Yes — in scope of the FCA redress scheme | Yes — in scope of the FCA redress scheme |
Personal Contract Purchase (PCP)
With PCP you pay a deposit and fixed monthly payments over an agreed term, but you are only paying off the car's expected depreciation. At the end you can hand the car back, pay the large final "balloon" payment to own it, or put any equity towards a new deal. The balloon is based on the car's Guaranteed Minimum Future Value (GMFV), estimated at the outset.
Hire Purchase (HP)
HP is more straightforward: you pay a deposit and fixed monthly payments, and once all payments are made the car is yours automatically. Payments are higher than PCP because you are financing the whole value, and there is no balloon payment.
Why both PCP and HP are in scope
When a dealer arranged either a PCP or an HP agreement they typically received commission from the lender. Under a Discretionary Commission Arrangement (DCA), the dealer could influence the interest rate and earn more from a higher rate. The FCA banned DCAs on 28 January 2021.
However, the redress scheme reaches further than DCAs alone. As confirmed in PS26/3 (FCA, 2026), it also covers other high-commission arrangements and undisclosed ties between dealer and lender, on agreements running up to 1 November 2024. The type of finance you had — PCP, HP or conditional sale — does not by itself decide eligibility; what matters is whether commission was paid and how the agreement was sold.
How claims differ in practice between PCP and HP
The eligibility rules are the same, but there are some practical differences:
Amounts
There is no guaranteed amount for either type, and individual outcomes depend on the agreement. HP agreements finance the full vehicle value, so the absolute interest involved can be larger. PCP on more expensive vehicles can also involve substantial finance. Either way, redress is calculated under the FCA methodology and averages around £830 per agreement for those who qualify — varying widely, with some capped and some receiving nothing (FCA, 2026).
For more detail on amounts, see our guide to PCP claim amounts.
Documentation
The paperwork for PCP and HP claims is very similar. In both cases it helps to have (if available): the finance agreement, vehicle details, and the name of the lender. Our article on required documents covers what you need for both types.
Process and timeline
The process is essentially the same for PCP and HP. Because the redress scheme is under legal challenge, the overall timetable is uncertain and the FCA has said payouts will be delayed. We cannot promise a resolution date. Our timeline guide explains the current position.
What about conditional sale agreements?
Conditional sale agreements work much like HP — you make regular payments and own the car once the final payment is made; the main legal difference is when ownership formally transfers. For redress purposes they are treated like HP: if commission was paid and the agreement falls within the eligibility window, the same rules apply.
What about personal loans used to buy cars?
A personal loan from a bank or building society used to buy a car is generally not covered, because there was no dealer or broker earning commission as an intermediary. If a dealer arranged a loan on your behalf, it could potentially be in scope. The key question is whether a middleman was paid commission on the credit.
What if you have had both PCP and HP?
Many people have used different finance types over the years. Each agreement is assessed separately, so it is possible to have eligible PCP and HP agreements. Having more than one agreement does not guarantee redress on any of them — each is judged on its own facts under the FCA scheme.
What is NOT eligible
Not every agreement qualifies. Based on PS26/3 (FCA, 2026), the following are generally not eligible:
- Personal Contract Hire (PCH) leases
- 0% finance deals
- Agreements with very small commission, or the lowest 5% APR deals
- Cases already decided by the Financial Ombudsman Service or a court
- Agreements outside the 6 April 2007 to 1 November 2024 window
Note that agreements you have paid off or settled, and agreements held by customers who have since died, are eligible — the old "28 January 2024" date some sites mention was a complaint-handling pause, not the eligibility cut-off.
Common questions
Can I claim if I voluntarily terminated my PCP? Voluntary termination does not, by itself, remove an agreement from scope. Eligibility still depends on commission and the sale.
Can I claim on an HP agreement I paid off early? Paid-off and settled agreements within the window can still be eligible (FCA, 2026).
I rolled PCP equity into a new PCP — can both be considered? Each agreement is assessed separately, so both could potentially be in scope.
Does it matter if the car was new or used? No. New and used car finance can both be in scope, whether PCP or HP.
A note on fees and your options
You can complain to your lender directly for free, and you do not need a claims management company. If you choose to use a regulated claims firm, fees are banded by the amount recovered and are capped at a maximum of 36% including VAT (15%-30% plus VAT), in line with FCA rules. There is no guarantee any claim will succeed, and the redress scheme remains subject to legal challenge, so timescales are uncertain.
Check your agreements
Whether you had PCP, HP or both, the sensible step is to check. Commission was a widespread issue across motor finance, and both finance types are within scope of the FCA scheme.
Start your free claim check now — you can submit details for each agreement separately. Remember you can also go to your lender directly for free. Our service is offered on a no win, no fee basis, and nothing here is a guarantee of a payout. Get in touch if you need help working out what type of finance you had.
