Is there a chance that the holder is slipping inside the pulley?

Yeah like Tom says sounds like the insert for the spring is worn or the end clip requires adjustment. If parts are not available you could epoxy the end clip insert .

Thanks to both of you. I don't think the spring holder is slipping, and when I have taken the assembly apart to repair, the end clip has insert always still been in place in the holder notch. Read elsewhere that the problem can be caused by winding the assembly too tightly before inserting the rope. Your thoughts on this? Could that be the problem?? Thanks again!

Most definately can ! Most often if you have not reserviced the recoil the amount of preload may not be evident . The recoil should rewind smoothly not to rapid when not attached to the Unit . Once installed if you find it does not rewind completely , just remove and give it another turn or two and reinstall . Trial and error , normally once around the block and you will have it .