The Financial Ombudsman Service has warned of a rise in the number of calls about miscalculated mortgage payments by lenders.
The FOS says the issue of “mortgage underfunding”, where borrowers are making repayments that are too low, is a long-standing one but notes a recent increase in the number of enquiries about how the ombudsman would deal with these complaints.
The FOS gets 100-200 mortgage underfunding cases a year, which typically account for 1 to 2 per cent of the total mortgage complaints received.
A spokeswoman says: “We have seen more enquiries of late about mortgage underfunding but we are waiting to see how that translates into actual cases.”
When it comes to deciding appropriate redress, the FOS will look at whether the lender is entirely to blame or if the borrower could have reasonably known that they were not paying enough. It says the recent increase in the number of complaints may stem from a greater awareness among consumers about lenders miscalculating mortgage payments.
The spokeswoman says it cannot comment on individual firms but the fact that a lender recently made errors in some of its mortgage calculations may explain part of the increase.
Yorkshire Bank and Clydesdale Bank wrote to 18,000 variable-rate customers in July apologising for an error which meant that the banks collected less than the agreed minimum monthly payment.
A spokeswoman for Yorkshire Bank and Clydesdale Bank says that of the total number of affected customers, only a small proportion complained and an even smaller number reported to the FOS. She says: “Looking purely at the data we have, it would not seem that as yet this would have caused an increase in the number of complaints that have gone to the FOS.”