Car Finance Solicitors and Claims Companies: Do You Need One?

Do you need a solicitor or claims company?

You do not need either, because the FCA's scheme makes your lender check your agreement and work out any compensation with the same rules, whoever makes the complaint. The free route covers the whole job of claiming: find the lender, complain, reply to its decision, and go to the Financial Ombudsman if you disagree. A firm does those same steps for you, for a fee.

A court claim changes the route. A court case on the same agreement lets the lender pause your claim under the scheme until the case is stayed or withdrawn. Your claim leaves the scheme once the court goes on to decide whether the lender is liable (SRA, 22 July 2026). Accepting compensation under the scheme means withdrawing the court case. The FCA says the scheme is likely to be simpler and more certain than court, where you could end up with less after legal fees.

Our car finance claim calculator shows what the FCA's rules give on your agreement before you decide anything.

What do solicitors and claims companies do?

A claims management company is authorised by the FCA and complains to your lender for you; a solicitor or law firm is regulated by the SRA and can also take your claim to court.

A firm that calls itself a PCP claims company does the same job for hire purchase and conditional sale agreements, and for vans and motorbikes as well as cars. The FCA scheme covers them all under one set of rules.

Some claims companies act as referrers, the SRA says: they collect your details, often from social media adverts, and pass them to a law firm. A law firm that represents you must confirm directly with you that you want it to, and must hold a record of that.

What firms charge

The FCA says car finance claims companies and solicitors can take up to 36% of your compensation, including VAT. Claims management companies also have a fee cap set by the FCA in CMCOB 5.2, by the size of the award. The cap excludes VAT:

Here is what those rules mean on three figures. The second and third are agreements built from the FCA's rules in our guide to how much compensation you could get, not real cases.

Fees charged by a lead generator that passed your details to a claims company count as part of that company's cap (CMCOB 5.2). We have not found a fee cap for solicitors on these claims. Ask any law firm for its fee, its termination fee and whether VAT is added, in writing, before you sign.

The Financial Ombudsman Service charges a firm a case fee of £260 for each case it brings in 2026/27, cut to £80 if the outcome changes in the customer's favour. You pay nothing to the Ombudsman if you bring the case yourself.

No win no fee: what it means and what it costs

"No win no fee" means you pay the firm a share of your compensation only if you get some, and the FCA says that share can be up to 36% including VAT. The SRA expects most car finance commission cases to be on no win no fee terms, such as a conditional fee arrangement or a damages-based agreement. Where a no win no fee claim fails or no longer exists, the SRA expects no charge.

Fees can still arise when you leave a firm early. A claims company must let you cancel within 14 days with a full refund, and after that any exit fee must be reasonable and reflect the work done (CMCOB 2.1). A law firm's termination fee must be stated up front in your agreement, and it can bill only reasonable charges for work it can show it has done and you agreed to (SRA).

A claims company's adverts must say that you can claim for free yourself (CMCOB 3.2.7R). They must not suggest you get a better result through the firm than by going to the Ombudsman yourself (CMCOB 3.2.6R).

Cancelling or changing a firm

You can cancel a claims management company within 14 days of signing and get a full refund (CMCOB 2.1). To leave after that, or to change firm:

1. 1
   Ask the firm for its exit fee in writing, with a breakdown of the work it says it has done. The FCA says vague terms such as "case progression" or "file review" are a reason to ask the firm to justify the charge.
2. 2
   Check you have one firm per claim. Signing with two firms can mean fees to end one agreement or two firms claiming a success fee, the FCA warns. Only one firm can take a claim forward, and the SRA expects the firms to sort that out between them.
3. 3
   End the agreement if you want to claim yourself. The SRA expects some people to do this to use the FCA's free scheme.
4. 4
   Complain to your lender yourself, using its complaint form or the FCA's template letter.

You can ask to leave a contract for free if a firm signed you up without your consent, misled you or treated you unfairly, the FCA says.

Regulators have acted on exit fees: more than 28,000 consumers have left claims contracts free of charge, the FCA reported on 16 July 2026.

What regulators have found

The FCA, the SRA, the Advertising Standards Authority and the Information Commissioner's Office are working together on poor practice in car finance claims. Their findings so far:

• the FCA has had 1,200 claims adverts removed since January 2024, 170 of them in June 2026;
• the FCA has agreed 12 voluntary requirements (VREQs) with claims firms in 12 months and opened 2 enforcement investigations;
• 3 claims companies cut their fees for 500,000 customers;
• the FCA has removed adverts that used its scheme in a way that suggested a link with the FCA;
• the SRA had 89 open investigations into 71 law firms handling high-volume consumer claims at 31 January 2026;
• the FCA and the SRA warned firms on 4 February 2026 about signing the same customer more than once and about excessive termination fees;
• the ASA is investigating law firm adverts over exaggerated compensation amounts and misleading "free checker" tools;
• the FCA issued 8 alerts about unauthorised firms in June 2026, which is why the checks below start with the regulators' registers.

Sources: FCA joint taskforce update, 16 July 2026 and the FCA and SRA joint statement, 4 February 2026.

Choosing and checking a firm (we do not rank firms)

We do not rank or recommend firms; check any firm yourself on the regulator's register before you sign anything. We do not name a best PCP claim company or law firm, and the five checks below work on any firm you are considering:

1. 1
   Find its number. A claims company shows its firm reference number (FRN), and a law firm shows its SRA ID, usually in the website footer or the contract.
2. 2
   Search the FRN on the FCA's Financial Services Register or the FCA Firm Checker. Check that the name and address match, that the firm is authorised, and that its permissions include claims management.
3. 3
   Search the SRA ID on the SRA Solicitors Register for a law firm in England and Wales.
4. 4
   Search the name on the FCA Warning List of unauthorised firms.
5. 5
   Get the fees in writing, including any termination fee, and compare them with your own estimate.

Complaining about a firm

Complain to the firm first; if that does not settle it, take a claims company to the Claims Management Ombudsman and a law firm to the Legal Ombudsman, both free for consumers. The FCA publishes a template letter for complaining to a claims company or law firm on its car finance claims page. The Claims Management Ombudsman is part of the Financial Ombudsman Service. The Legal Ombudsman applies time limits, and you can also challenge a solicitor's bill in court (SRA). Our complaints page sets out each route.

The free route: complaining to your lender is free, and so is the Financial Ombudsman Service. Our calculator gives you an estimate under the FCA's published rules before you choose a route.

Last checked 16 October 2026 against the FCA's consumer page, CMCOB 2.1, 3.2 and 5.2, the FCA press release of 16 July 2026 and the SRA consumer guide of 22 July 2026. Written by Tirion Oman. Spotted an error? Tell us through our contact page; the editorial policy explains how we correct figures.

Sources: FCA, car finance claims · CMCOB 5.2 · CMCOB 2.1 · CMCOB 3.2 · SRA, motor finance compensation claims · Financial Ombudsman, case fees