The Irish Financial Services Regulatory Authority (IFSRA) is undertaking a study of the endowment mortgage market in an attempt to quantify the extent and scale of any problem.

Just nine queries relating to endowment mortgages have been made to the consumer watchdog since it was set up in May 2003. It began the first phase of its current study in July.

IFSRA's consumer director, Ms Mary O'Dea, is concerned that homeowners with endowment mortgages may not be aware that the proceeds of their policy could fall short of the sum needed to pay off their loan.

Under an endowment mortgage, the homeowner only pays the lender the interest due on the mortgage.

He or she then pays premiums into an equity-linked fund sold by a life assurance company. The final value of this policy is used to clear the mortgage at the end of the term.

In the UK, endowments sparked a major mis-selling scandal over a decade ago after it emerged that homeowners had been told that their policies were guaranteed to pay off their loans.

In fact, stock market losses meant that most were suffering a shortfall.

Around 90,000 of these mortgages have been sold in the Republic since 1989. Some are now nearing maturity, although many owners have already either increased their contributions to cover the shortfall, extended the term or converted to a normal repayment mortgage.

IFSRA is advising consumers who believe they were the victims of mis-selling to complain to their endowment provider before taking their complaint to the Insurance Ombudsman.

Last year, IIB Bank became the first Irish lender to issue a general warning, asking over 3,000 endowment mortgage customers to check with their insurance company about the projected maturity value of their policy. Its customers have an average shortfall of €8,000.