Buying a new car is one of the biggest purchases that anyone can make, especially with the vast array of different makes, models and types on the market today. The average cost for a small car, for example like Ford Fiesta is £15,450, whereas the Average SUV is £25,626 (source: NimbleFins)
Many people use car finance as a way to purchase a car, spreading the cost over a longer period of time, by paying a small amount per month.
These finance options can seem like a good option, but in some cases, customers are paying pay overall on their car finance packages than they should be. One such car finance firm that has come into the spotlight recently is Moneybarn.
Moneybarn is a car credit company, owned by doorstep lender Provident Financial, that offers customers finance for Car, Motorbike and Vans. Moneybarn state that they are “experts in approving customers for finance” for people who may have otherwise struggled to get approved for a car loan or have a poor credit score.
It’s parent company Provident Financial, has been in the spotlight recently as it is looking to introduce a scheme to limit compensation paid to customers who were mis-sold loans, in a move similar to gurantor lender, Amigo Loans.
In February 2020, Moneybarn was in the headlines after being fined £33 million as a result of the Financial Conduct Authority found Moneybarn had not treated customers fairly when they fell behind on repayments.
Over 6,000 customers were given car finance refunds after the FCA found that the “lender didn’t sufficiently communicate what would happen if they defaulted on payments before taking out an agreement”.
The exact figure that each customer received is unknown, but an equal share of the pay-out is around £5,000 for each individual.
Moneybarn’s APR is 31.9%. As an example of this APR in action: If you borrowed £12,000 over 55 months, with monthly payments of £393.20, you would repay a total of: £21,232.80.
If you have been affected by your car finance loan from Moneybarn, we can help you claim the compensation you deserve.
Here are some examples of circumstances where you might have been mis-sold a car finance package:
The Financial Conduct Authority (FCA) conducted mystery shopping trials of the industry. The results were alarming, including the following facts and statistics:
The total amount customers could be over-paying in interest charges per year due to mis-sold PCP Schemes
The average amount a single customer could be over-paying in interest charges on a typical £10,000 mis-sold PCP scheme over four years
The estimated number of customers affected by mis-sold PCP schemes
The total amount of car loans taken on by consumers in 2016
The difference between the average and highest commission a broker could earn through different commission models – incentivising brokers to charge higher interest rates for higher commission
Source: Autocar and Petrol Prices
If any of the above statements apply to your experience with your Personal Contract Plan (PCP), you could be eligible to claim compensation. Start your claim today or get in touch with the experienced team who will guide you through the process. We are here to help.
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