What the estimate measures
The calculator compares two loans for the same amount and term: one at the rate you were charged, one at a benchmark rate you believe a fair quote would have used. The difference in interest is the overcharge.
It does not decide whether you were mis-sold anything, and it does not include fees or charges that may also be refundable. Those depend on the lender and the ombudsman's approach.
Worked example
Borrowing £12,000 over 60 months at 12.9% costs £4,345.38 in interest. At a 7.9% benchmark the interest would be £2,564.57, so the total overcharge is £1,780.81.
That is £29.68 a month. After 24 payments, the estimated overcharge to date is £712.32.
What to do with the figure
Use it as a starting point for a complaint, not as a demand. The lender or the Financial Ombudsman Service decides the remedy, and may use a different benchmark or period.
Keep the agreement, the statement and any commission disclosure you received. A complaint usually needs the agreement number and the date you signed.
Inputs for the car loan compensation calculator
Amount financed
The amount you borrowed on the agreement.
Rate you were charged
The APR on your agreement.
Benchmark rate
The rate you believe a fair, commission-free quote would have used.
Agreement term
The full term of the agreement in months.
Months paid so far
How many payments you have made.
CALCULATOR QUESTIONS
Car loan compensation calculator questions
Is this the amount I will get back?
No. It is an estimate of the interest difference. Any redress is decided by the lender or the ombudsman.
What benchmark rate should I use?
A rate you can support with evidence, such as a quote you had at the time or the lender's own lower tier.
Does it include fees?
No. It compares interest only. Arrangement or documentation fees may be separately refundable.
How long do I have to complain?
Time limits apply. Contact the lender first, then the Financial Ombudsman Service if you are not satisfied.