Complaints are tough. No one likes to receive them, and to be honest, most of us don’t like to make them.
It takes time, energy and a certain amount of dogged perseverance to complain and actually see a resolution.
However, as challenging as they can be, they are incredibly useful to track. As an organisation, they tell you where your systems and processes are falling down and when your literature needs to be clearer, and raise issues that you may never have considered.
Understanding why people complain
At the Equity Release Council, we monitor all the complaints that go to the Financial Ombudsman Service (FOS) about equity release and recently undertook further analysis on what we have seen since the start of 2020.
The figures are encouraging, with 301 complaints about these products and only 48 (or 16%) upheld or partially upheld.
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While each complaint was naturally unique due to the customers’ circumstances, the council undertook analysis to see if there are any trends in upheld complaints. This revealed that the largest single cohort was when delays caused the offer to expire and the customer was offered a different rate (seven complaints).
When you look at these complaints, they do tend to be more complex cases such as when people are moving or irregularities have been discovered as part of the conveyancing process. However, they do suggest that more needs to be done to manage client expectations and ensure that even complex cases proceed as smoothly as possible.
The second-largest collection of complaints reference ‘porting’ (six complaints).
Under Equity Release Council standards, all clients have the right to move home and ‘port’ their plan with them if they meet the lender’s criteria. However, borrowers can run into challenges when the properties are either not suitable long-term collateral, or the loan to value (LTV) does not work due to the value of the property.
However, digging into these complaints, it would appear that several of the cases highlighted administrative challenges, and while the customers’ complaints were upheld by the FOS, the redress awarded was minimal.
Certain complaints due to the lenders’ decision to decline further borrowing (four complaints) or an application due to lending criteria (four complaints) were also upheld.
Finally, four complaints were upheld based on concerns as to whether the clients fully understood the decisions they were making, due to vulnerability. Now, four complaints on this issue are four too many, but again, a deep dive highlights that these issues were all raised by families rather than the clients themselves.
Don’t just minimise disputes, learn from them
This highlights the vital importance of including families in the advice process where possible, as it will reassure them that their parents are making the right choice or encourage them to discuss whether this is the right option well before any complaints are raised.
No industry is perfect, but we need to remember that learning from complaints isn’t just about fixing what’s gone wrong.
It’s about uncovering opportunities to improve and grow and ensure that the next customer gets an even better outcome.
The FOS data suggests that for the vast majority of customers, the advice provided and the service received meet or exceed reasonable expectations, proving that when done correctly, later life advice can result in the right outcomes for the right customers.
