Compensation Basis / Option

STFC_2

My bank have conceded that they mis-sold me my Endowment Mortgage and have asked me to choose my basis of computing the (if any ) compensation due to me .

I can either have this computed by reference to the "actual" conduct of my mortgage since inception (i.e. taking into account any fluctuations in the capital from year to year and changes in the type of interest rates adopted - fixed / variable etc)

or

I opt to use their "simplified route" which assumes no arrears or overpayments and the "Standard Variable Rate" for interest throughout .

They say that the latter may arrive at a lower or higher amount of compensation but cannot revert back if I choose this option . They've also only given me a few days to choose !

The mortgage has been an Endowment for 17 years I have for the past few years increased my mortgage payments (because of the possible shortfall) and have in fact paid a fair chunk (£4500 ( 20%)) of additional capital off.
I,ve heard this may go against me in working out compensation .

Any views or comments or recommendations please ?
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dunstonh

I,ve heard this may go against me in working out compensation .

It can go both ways. One way you provide them the rates and dates, the other they will make assumptions.

can you provide them with the data they need to make a real calculation?

YorkshireBoy

STFC wrote:

I,ve heard this may go against me in working out compensation .

Any views or comments or recommendations please ?

This is just a statement of fact - NOT a recommendation...

I've successfully proved that my endowment was mis-sold to me, by my building society, in the mid-90's (£39K, 25 years, £59/month). As of the last report, it was forecasting an £8K shortfall at 6% growth, and has 13 years left to run. Like you, I had been overpaying my mortgage, but on (to me at least) a massive scale - £19,000 over the last 4.5 years.

My mortgage lender's first offer, based on their standard method of calculation, was £2,900. Because I *thought* I'd receive a better offer, I had them re-calculate the compensation based on my overpayments - but on the proviso that I could take the better of the 2 results. Surprisingly, they agreed!!

The result was 17 pages of calculations, culminating in a revised offer of only £2,200 - a full £700 less. Needless to say, I have accepted the original offer and await the cheque.