time bared

dunstonh

I didnt say you shouldnt do it. I just said that you best hope on the complaint to the FOS is if you think the time bar was applied incorrectly.

If the time bar has been applied correctly, then the ombudsman will side with Lincoln. If the time bar has been applied incorrectly, they will ask Lincoln to reconsider the complaint. That is you only issue here.

The only way you are going to find out is to put that complaint in. I just wouldnt hold your breath. You lose nothing by doing it though.

EdInvestor

I should take the complaint to the FOS as it's quite possible Lincoln is trying it on with this timebar thing: they have to show they have sent you red letters warning you of shortfalls before they can do this.

Meanwhile, looking at the endowment itself:

Ellemaid wrote:

My father bought a home with endownment policy in 1990. took out £81,000 for a 20 year term.Now, he is in a situation where he is very likely to be in a short fall of £20,000-£25,000 at the end of term.

If you were to surrender it and place it on deposit @4% also paying in the premiums to maturity you should receive 65,205 wgich is more like a shortfall of 15-16k than 20-25k.

So I suggest your father surrenders the endowment,pays the money into reducing the mortgage and finds himself a mortgage broker to seek a new cheaper mortgage on a repayment basis,for the lower amount owed.He should then pay off this mortgage using both the money he is paying out now for the mortgage itself and the endowment.

This will give him a better return than staying with Lincoln and clear up the shortfall.

If he needs to replace the life cover, he should do it before surrendereing the endowment.

dunstonh

I would say that the alternative funds with Lincoln have greater potential for growth at the 6 to 8% mark. The decision to switch funds or surrender should only be made after consideration of the investment risk and costs of the alternative options.

Ellemaid

Thank you guys.

I was also thinking of surrendering the policy to when the adviser informed us of the shortfall, but i dont know how positive it will be at this point in time.
I am going to have a meeting with the bank and see what they say.
I am doing my research on funds, and was going to find out if it is possible to transer the funds without further costs. Natwest has always wanted us to transfer our mortgage to them. I was going to have a meeting with them and see what they say bout repayment mortgage.

"I would say that the alternative funds with Lincoln have greater potential for growth at the 6 to 8% mark."

Can you possibly tell me a bit more about the fund u have mentioned dunston?

If everything fails, then me and my sister will both half whats left and help dad. Afterall, my sister wants the house after my parents, so its fair she does her bit.

Thank you for great advise :T

dunstonh

I am going to have a meeting with the bank and see what they say.

Warning there. Bank is likely to bring in a tied financial advisor. In otherwords a salesman. Strictly speaking, the advisor cannot discuss the endowment as it is not a product from their company. They can only discuss endowment generics. That will be little use to you as you need specifics on the endowment to see what option is best.

Can you possibly tell me a bit more about the fund u have mentioned dunston?

I cannot. It would breach board rules. However, they do operate a fund range with some better potential funds than you have. Get the list of funds from Lincoln and you will be in a better position there. You could also seek independent advice locally and see what comes of it. That would be better than going to a bank and seeing a salesman.

EdInvestor

There are quite a lot of Lincoln life funds, reflecting the fact that it has taken over smaller companies in the past and some of the funds are restricted to investors with policies from those old companies.

Here's the list

They start at no 1527 and go over the page to 1617.
There are some funds there that might be worth using - IF you are allowed to switch into them.

But frankly, with a company like Lincoln, you are very likely to be paying high charges on an old policy . So even if you do switch to these better funds, your performance is likely to be below what you would get for a new risk based investment in an ISA say - that is, assuming you want to take more risks with this mortgage (perhaps you don't!)

As I said before suggest you have a meeting with an independent mortgage broker (not the bank!) and get a view from him about unbundling the whole thing via a surrender and new repayment mortgage.

Ellemaid

Thank u for the list of funds EdInvester.

How would an ISA investment work?
My father is thinking about repayment mortgage. if transfering funds doesnt seem appropirate, then thats what we will do.

I spoke to Lincoln financial ltd about change of funds. They said, we would be able to get one free change of fund within the year. but any further will be charged at £7.50 per change. Since we havnt changed, we would be able to get one free fund.
They also said, they would be able to change it within 3-4 days of recieving a letter from the owners. which is a good news, i think. now, i must look into funds and find a private adviser.

god, for those who r thinking of buying a property, please please think twice before choosing your mortgage policy, and please get advise from many different people without going on trust. thats what my father did, and see where it got him - a big headach.

Thank you all for your advise. I am very grateful

dunstonh

I spoke to Lincoln financial ltd about change of funds. They said, we would be able to get one free change of fund within the year. but any further will be charged at £7.50 per change. Since we havnt changed, we would be able to get one free fund.

Its one free switch per year, not one fund. So, if you switched out of both funds into a spread across 6 others, that is classed as one switch.

How would an ISA investment work?

Similar to the endowment but it may cost less, it may cost more than the endowment.

Ellemaid

so, i guess ISA is out of the question.

the problem with funds is its performance. with only four years left, its a very big risk. repayment mortgage compared to that, seems to be as risky. :sad:

Ellemaid

Hi,

Ive managed to make an appointment with a financial adviser for monday. He gave me some information over the phone, and sounds good. He informed me that doesnt charge for his service. He only likes his clients to refer him to others. I dont know if advisers offer free advise or if there is another motive.
Other places have taken my number and hopefully ring me back