FOS reports more interest-only complaints

In its annual review of consumer complaints the FOS said interest-only borrowers were increasingly questioning the financial advice they were given.

Despite such concerns, complaints about mortgages fell by 2% in the year to March 2015 compared to the one before.

There were 12,297 complaints about mortgages over the course of the year, down from 12,606 in the year to March 2014.

The report read: “The number of complaints about interest-only mortgages continued to increase. Most came from people worried that they wouldn’t be able to repay their mortgage – and questioning the advice they were given.

“On the other hand, we heard from fewer people at the end of their interest-only mortgage arrangement who couldn’t repay the capital. We hope this is because lenders are working constructively with customers who find themselves in this position.”

Complaints fell by 20% for income protection, 19% for contents insurance, 13% for critical illness insurance and 28% for mortgage endowments.

But they rose by 2% for secured loans and 10% for buildings insurance.

Consumer credit services saw some of the biggest increases in complaints, as they rose by 46% for payday loans and 47% for debt counselling.

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