Millions of Australians with car loans are holding their breath as the Supreme Court's landmark ruling on hidden car finance commission claims is expected to be delivered this afternoon. Consumer champion Martin Lewis has been providing expert guidance, outlining the three possible outcomes and what they mean for drivers potentially affected by motor finance mis-selling.

The case centres around whether banks and lenders were obliged to pass on commission they received to borrowers. If the Supreme Court rules in favour of the claimants, it could open the floodgates for a wave of compensation claims, potentially impacting millions of Australians who took out car loans between 2008 and 2021.

What are the Three Possible Outcomes?

Martin Lewis has broken down the potential rulings into three key scenarios:

1. Full Win for Claimants: This is the most significant outcome. If the court finds that lenders were obliged to pass on commission, it would mean that millions of drivers may be entitled to compensation. Lewis estimates that this could amount to a collective payout of billions of dollars. This outcome would likely trigger a surge in claims and potentially lead to lenders proactively offering compensation to avoid lengthy legal battles.
2. Partial Win for Claimants: The court might rule that lenders had a duty to disclose the commission, but not necessarily to pass it on. This would still be a positive step for claimants, as it would strengthen their arguments and could lead to settlements. However, the compensation amounts would likely be lower than in a full win scenario.
3. Loss for Claimants: If the court rules against the claimants, it would significantly dampen hopes for compensation. While it wouldn't completely shut down the possibility of individual claims, it would make them much harder to pursue and less likely to succeed.

What Happens After the Ruling?

Regardless of the outcome, Lewis advises motorists to take action. Here's a breakdown of what to do:

• Check Your Eligibility: Did you take out a car loan between 2008 and 2021? If so, you may be eligible to claim.
• Gather Documentation: Collect any loan agreements and statements you have.
• Seek Legal Advice: Consider consulting with a solicitor specialising in financial claims to assess your options.
• Group Action: Many group action claims are being organised – this can be a more cost-effective way to pursue a claim.

The Impact on the Financial Sector

The Supreme Court's decision is expected to have a significant impact on the financial sector, regardless of the outcome. A large payout to compensate affected motorists could hit lender profits hard. Banks are already bracing for potential losses and are likely to review their lending practices to ensure compliance with regulations.

Disclaimer: This article provides general information and should not be considered legal advice. Always consult with a qualified professional for advice tailored to your specific situation.