Robert Sinclair, director of AMI
The FSA and Financial Ombudsman Service (FOS) have only recently started publishing this complaints data, with each having different meanings.
Indeed, the FSA data is still developing as firms clarify what should be counted. These early numbers may not be totally comparable, as I think we are seeing firms reporting more accurately following the first data publication.
However, we have a clear trend where complaints management companies have been targeting this area since the start of 2009 and this will escalate. This increase to 22,662 complaints is in a category that includes administrators and providers as well as brokers.
To assist understanding it is necessary to differentiate the type of complaint in these FSA figures. Indeed, complaints about “Home Finance”, which cuts the data another way, fell from 80,230 to 56,393. Are these complaints over bad processing, over being refused a loan, a further advance or poor advice?
Also, it is important to assess when the issue actually occurred. The volume of complaints about advising, selling and arranging fell from 22,746 to 5,651. The volume of complaints on general admin and service issues only fell from 27,594 to 24,186.
In truth, the increased uphold rate may indicate a firms acceptance of an issue and is probably a reflection of the pressure they have been under to improve their initial complaint handling and reduce the volumes arriving at FOS.
The FSA data has to be volunteered by firms and therefore focuses on the larger lending groups. Brokers have long been aware of the service issues with some of these lenders and reflect this in their advice where appropriate.
At a time when arrears are still an issue, credit criteria are tightening and many are re-structuring their back office, a rise in complaints is not unexpected.
It is, however, not satisfactory and all firms need to work to resolve the issues causing the complaints. I remain concerned that too many are focused on their complaint handling processes.
Also answering in this week’s Market Watch are:
Andrew Frankish, managing director of Mortgage Talk
Alan Lakey, principal of Highclere Financial Services
