Advisers expect IOM scandal
John Bridge, director of sales and marketing of the mutual, said: “Between 2013 and 2043 the FCA expects about 2.6 million of these types of mortgages to be due for repayment.
Those over the age of 50 will be hardest hit, with most of these loans due for repayment with no existing repayment strategy.
Bridge said: “I believe mortgage advisers, Financial Advisers and the FCA all need to work together to ensure another such scandal does not occur.
“Advisers need to work with clients to help them work out an affordable repayment option.”
The survey also found that 94% of advisers said they always recommend clients with existing or new mortgages consider protection products but revealed that they felt they have no support from the Regulator when selling protection products.
Some 65% of advisers also said that they felt let down by the way the FSA had required them to offer PPI before the scandal.
And 40% also said they did not feel the FCA was supportive of them selling any protection products.
Over a third of advisers said that better educated consumers would help them write more income protection business and sighted clients not understanding that they need the product and a general lack of product awareness as barriers to consumer engagement.
Bridge said: “The responses we have received from Financial Advisers in this survey show that there is a need for more education and awareness for consumers when looking into protection products for mortgages.
“Consumers need to be educated as to why protecting their mortgages is so important. Unfortunately many advisers in our survey felt their clients did not see the need or thought the state would pay if they fell ill and could not work.
“As an industry we have a duty to get protection products on the agenda and help clients make good, well informed choices.”