If your car finance complaint has reached a dead end, perhaps because your lender rejected it or you have been waiting months without a reply, you are not alone. In 2025, thousands of drivers are in the same position, especially with the car finance scandal under intense public scrutiny. Investigations have revealed how millions of loans were sold in ways that may have been unfair.

The Financial Ombudsman Service (FOS) [1] reviews unresolved disputes between financial firms and consumers. It helps people get fair results in car finance claims, including for cases with inflated interest rates, hidden commissions or add-ons you never agreed to.

This guide explains what the ombudsman does, how the process works, and what to expect if your PCP claim is escalated to them.

When Should You Involve the Financial Ombudsman?

You must first raise your complaint directly with your lender or finance company, who then have eight weeks to respond.

If you receive a final response that you are unhappy with, or hear nothing within that eight-week period, you can escalate the case to the ombudsman.

In 2025, there is one significant complication. Following the FCA car finance investigation into discretionary commission arrangements (DCAs), lenders can pause commission-related complaints until at least 4 December 2025 [2]. This mainly affects cases about hidden or variable commissions.

If your complaint is about affordability, product suitability or poorly explained add-ons, you can still move forward now. About six weeks after the FCA publishes its redress scheme consultation (expected in October 2025) [3], the rules will be finalised.

What Will the Ombudsman Examine?

The ombudsman looks at the bigger picture, not just the fine print. They consider whether your finance agreement was transparent, fair, and compliant with both regulations and basic consumer rights.

1. Was the Finance Product Suitable?

Did you sign a contract with no explanation of the final balloon payment?

Did the dealer push you toward a longer term or higher interest rate when you had other options?

Was it written clearly without jargon?

Redress may be available if the product is not suitable or the terms are poorly explained.

2. Was the Commission Properly Disclosed?

Many mis-sold PCP car finance cases centre on commission mis-selling. The lender may pay commission to the dealership or broker without informing the customer in some instances.

If the commission was discretionary, they could raise your interest rate to earn more for themselves. If you believed you were getting the best rate but were not told about this, the ombudsman is likely to see it as unfair.

3. Were Add-Ons Clearly Explained?

Adding add-ons without consent is a common problem. If you ask, "Can I claim if my PCP agreement included GAP insurance or other add-ons I did not ask for?" the answer is often yes, especially if you were not given a choice to accept or decline them.

4. What Evidence Is Needed?

You do not need a box full of documents to go to the ombudsman. While paperwork helps, they will also consider:

• Your written account of what happened
• Any emails or call notes you have
• Bank statements or payment records
• Evidence from the lender

Which Decisions Has the Ombudsman Made in Similar Cases?

FOS decisions in favour of consumers have increased in recent years, in particular car finance mis-selling cases.

Common outcomes include:

• Partial interest refunds where commission was not disclosed.
• Reimbursement of mis-sold add-ons such as gap insurance or service plans.
• Compensation for stress or inconvenience in the case of misleading or high-pressure sales processes.

After the August 2025 Supreme Court ruling [4], DCA cases will still be able to be redressed under the new FCA scheme, while only very large fixed undisclosed commissions will likely qualify. It'll guide how the ombudsman treats commission-based complaints in late 2025 and beyond.

Understanding the Ombudsman Process-Step by Step

What happens when you escalate a complaint to the Financial Ombudsman Service (FOS):

1. Making Your Complaint

Contact the FOS online, by phone or by post. You should outline what happened, provide evidence if necessary and describe what you hope to achieve with the complaint.

2. Assignment of Your Case

Your case will be assigned to an investigator who will review it objectively. Then they review your information and may contact you or the lender for additional clarification or documents.

3. Assessment and Initial Outcome

Once the investigator reviews everything, they'll give a preliminary view to both parties. If everybody agrees with the suggestion then the matter is settled on that basis.

4. Final Ombudsman Decision

Should there be disagreement with the investigator’s recommendation, the case goes before an Ombudsman. The ombudsman will reach a decision on that one. That's legally binding on the finance company but you are not obligated to accept it as your own.

5. Anticipated Delays in 2025

With complaint handling suspended and a surge expected following the FCA ruling, the FOS is handling a high caseload. Cases can be reviewed and resolved over months. So submit your complaint early to avoid the backlog.

Can You Challenge the Ombudsman’s Decision?

Yes. The finance provider must follow the decision but you are not obliged to accept it. You can:

• Bring more evidence before the decision is finalised.
• Delay that decision and take it to court.

If you are unsure, our guide on “Do I need a solicitor to file a car finance mis-selling complaint?” sets out the benefits and disadvantages of going to court.

How Reclaim247 Supports Ombudsman Complaints

The Ombudsman process can be complex. From preparing your complaint to communicating with the ombudsman, Reclaim247 takes care of everything. Operating on a no win-no fee basis, we will support your claim with evidence.

Whether it's a case of commission mis-selling, inappropriate finance or secret add-ons, we partner with our legal solicitors to make the strongest case for you so you can be successful.

Final Thoughts

The car finance ombudsman is a vital resource for drivers whose lenders have not resolved their complaints. In 2025, its role will be even more important as the UK deals with the consequences of years of mis-selling PCP agreements.

If your complaint has stalled or you have been told to wait for FCA car finance guidance, now is the time to prepare your evidence. We have helped thousands of customers build successful cases, and we can help you too.

Frequently Asked Questions

What is the Financial Ombudsman Service (FOS)?

The Financial Ombudsman Service is an independent organisation that steps in when a financial company, like your car finance lender, doesn’t resolve a complaint fairly. If you feel something wasn’t right about how your finance agreement was set up or explained, and the lender hasn’t made things right, the FOS can review the situation. They look at both sides of the story and decide what would be a fair outcome under the circumstances.

When should I reach out to the car finance ombudsman?

You can contact the ombudsman if:

• Your lender has said no to your complaint
• You’ve waited eight weeks with no reply

In 2025, a lot of complaints have been temporarily paused due to a wider investigation by the Financial Conduct Authority (FCA). While this pause applies to some cases, especially those involving hidden commissions, it’s still a good time to get everything in order so you’re ready when complaints start moving again.

Can I still make a complaint if I’ve lost my car finance paperwork?

Yes, you can. Missing paperwork doesn’t mean you’ve lost your right to complain. The ombudsman knows that not everyone keeps every document, especially if the agreement was from a few years ago.

What matters more is what you remember, for example, how the deal was explained to you, whether you were told about any interest rates or commissions, and whether any extras were added without a clear explanation.

You can support your case with things like your credit report, old emails, or payment records. And lenders are required to keep copies of the original agreement, so that can often be requested during the investigation.

What does the ombudsman consider when looking at a car finance complaint?

The ombudsman looks at the full picture, not just the fine print.

They’ll ask questions like:

• Was the finance agreement right for your needs at the time?
• Did anyone tell you that the dealer or broker was earning a commission?
• Were optional extras, like gap insurance or servicing plans, clearly explained before being added?
• Did you feel rushed or pressured during the process?

They take into account both your experience and the lender’s explanation. Their decision is based on fairness, as well as the rules that finance firms are supposed to follow.

What will happen if I don't agree with the decision of the ombudsman?

You are not bound to the ombudsman's decision in case you do not think it is fair. The finance company is the only party bound by their final ruling, not you.

You will still be able to pursue your complaint further, such as in court, which is what this means. Court proceedings can be lengthy and costly, so it's crucial that you weigh your options first.

If you’re not sure what to do, you might find it helpful to read our guide: Do I need a solicitor to file a car finance mis-selling complaint?

How long does the ombudsman process usually take?

The ombudsman process is rarely quick. Even in normal times, it can take a few months for a decision. And in 2025, with many complaints paused and a large backlog expected once the FCA issues its guidance, some cases may take even longer.

That’s why it helps to prepare a clear and well-supported complaint upfront. It can save time and avoid unnecessary delays later on.

Does Reclaim247 assist in Financial Ombudsman complaints?

Reclaim247 takes care of the entire procedure for you, from the time you file your complaint to escalation in case the lender fails to solve the issue.

We'll:

• Help in developing a good case with appropriate evidence
• Talk with the ombudsman on your behalf
• Keep things going by responding to follow up questions
• Assist you in case the case requires an additional review

Our goal is to ensure that your complaint is dealt with fairly and appropriately, even if that means going all the way to the ombudsman.

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1. Financial Ombudsman Service (FOS) - https://www.financial-ombudsman.org.uk/consumers/how-to-complain
2. lenders can pause commission-related complaints until at least 4 December 2025 - https://www.fca.org.uk/news/statements/extension-motor-finance-complaint-handling-pause-confirmed
3. FCA publishes its redress scheme consultation (expected in October 2025) - https://www.fca.org.uk/news/statements/fca-consult-compensation-scheme-motor-finance-customers
4. August 2025 Supreme Court ruling - https://supremecourt.uk/uploads/uksc_2024_0157_0158_0159_judgment_2bb00f4f49.pdf