Jay Chapman fell into serious debt after signing up for a ‘predatory’ car finance agreementJay Chapman bought the Volkswagen Golf for £13,000 in 2022 – but punishing interest rates saw him forking out almost £22,000 for the car(Image: Submitted)

A driver has told how he fell into serious debt after ‘pushy’ sales people persuaded him to take out a ‘predatory’ car loan.

Jay Chapman signed up for a car finance agreement when he bought a Volkswagen Golf for £13,000 in 2022. But punishing interest rates saw him forking out almost £22,000 for the car.

And when the Golf broke down needing costly repairs, the 29-year-old, a works as a drug and alcohol recovery co-ordinator in Manchester city centre, says he fell into serious debt.

He said: “The sales people were quite pushy. They made me feel like I had to make a decision there and then.

“I put down a deposit of £1,500, and they outlined the terms of the finance agreement. They made it sound affordable.

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“But quite soon after that, it became clear that I was paying a lot more than I should be.”

Within a year of Jay buying the Golf from a nationwide dealer it suffered an engine fault, which cost £3,000 to repair. He says further mechanical problems then left him unable to sell the car and all the while he was making repayments on top of hefty garage bills.

He said: “It left me in a bad financial situation. In total, I spent around £6,000 on repairs, and all the while I was shelling out hundreds every month for a finance agreement I couldn’t get out of.

Jay says he fell into serious debt after taking out the loan(Image: Submitted)

“It really caught me out. They don’t warn you about any of this when you buy the car. They make it sound simple and they give you peace of mind.”

But now Jay has now settled a legal case against the loan provider. It came after Manchester-based law firm Barings Law argued the agreement was sold without adequate checks to ensure it was affordable.

Jay got a pay-out of £3,900, which he used to voluntarily exit the agreement and settle his debt. The case comes as the motor finance industry faces continued scrutiny over mis-selling practices.

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Earlier this month the Supreme Court reversed earlier court rulings that had opened the possibility of widespread compensation claims for motorists who had paid hidden commissions on car loans. But despite that many drivers who took out a certain type of loan could still be in line for pay-outs – particularly those who were sold Discretionary Commission Arrangements, which were banned in 2021.

Jay’s case was unrelated to DCAs but Robert Whitehead, Chairman of Barings Law, said his experience highlights the wider problem of drivers being sold finance deals they cannot afford.

He added: “Many drivers just like Jay have fallen victim to predatory loan arrangements, benefiting the pockets of unscrupulous lenders who unfairly pushed up prices.”