Bob Young is managing director of CHL Mortgages
My mind has turned a lot to complaints recently not least because the Financial Ombudsman Service (FOS) recently revealed its complaints data for the second half of 2013.
It will have surprised no-one to hear that the level of complaints FOS had to deal with grew substantially over the course of 2013 and (again unsurprisingly) it was payment protection insurance (PPI) cases which made up the vast majority – 76% in case you were wondering.
Clearly in the ‘home finance and mortgages’ category complaints to FOS were at a much lower level however these ‘official’ figures tell you only a small amount about the true level of complaints received by lenders.
We must not forget that (certainly in CHL’s case) a large number of complaints we receive never make it to FOS because a) they are wholly speculative and without any merit, or much more unlikely b) we admit culpability and provide redress.
To be brutally honest we prefer to fight cases which we feel are completely unmerited and it has to be said that this often means the case goes no further.
The whole process of dealing with complaints should be very important to all businesses.
Of course you would much prefer not to have to deal with them at all, however this can often be a false economy and, to my mind, a business that receives complaints has the best opportunity to learn and benefit from them.
That said, we all want complaints at a minimum and we categorically do not want to deal with, what I would politely call, ‘chancers’ who feel the actual argument behind a complaint is irrelevant.
In this regard, we get a number of claims management companies (CMCs) ‘complaining’ to us about PPI even though we have never sold it – this tells you a lot about the number of companies who will pay up just to make the complaint go away even if they have done nothing wrong.
Many CMCs appear to rely on this which is why they continue to complain speculatively on behalf of individuals.
I must also say that brokers cannot be left out of this debate. We also receive client complaints which sometimes come via a mortgage broker who no longer works in the market.
Many of the cowboys were herded out of town when the Credit Crunch hit and the business dried up but this doesn’t stop them from ‘advising’ former clients to throw in a complaint for any ridiculous reason.
Over the past year there has been no particular single trend when it comes to the complaints we receive however our decision to appoint a Receiver of Rent (RoR) on a landlord’s property occasionally causes one. As does the fees that come with a RoR and many’s the time the client will have been led by their former adviser to complain about this.
This suggestion tends to be that this practice is anti-TCF (treating customers fairly) when in fact it is TCF in proper practice given that we are not moving to possession but simply removing the landlord from the monthly mortgage payment process.
I tend to point out that just because the client/adviser deems it to be unfair doesn’t mean it’s flying in the face of TCF.
I can assure you that, before taking such action, we will generally provide plenty of opportunity for the landlord to pay their mortgage, catch-up on their arrears, etc as it is often in all our best interests for them to do so. A decision to appoint a RoR is never taken lightly.
To my mind, genuine complaints should be welcomed as we can all learn from them. Unfortunately not all cases are genuine and you often wonder what advice the complainant has taken before making the decision to complain.
We have come across some weird and wonderful objections to our work and, while we treat them all seriously, they often appear a waste of time for all concerned right from the outset.
These types of cases are not helpful, and sometimes seem sent to try us, however the complaint process remains a very important one and we fully support the right for all customers to make use of the system if they feel their situation warrants it.