Red letter day!

Jazz56

Can't remember if I've ever posted before but I need some help now like never before! I'm absolutely hopeless with anything to do with money

Got a red letter warning that our first endowment is not likely to meet the target sum we were relying on.

HELP!

Have a part repayment and part interest only mortgage. Around 37k int. only and around 11k repayment. First mortgage & endowment taken out prior to 1988 and due to end September 2011 with target of £22,500.

What can we do?

peace
Jane

Pee

First of all, you have a mortgage of less than £50,000 and we are talking about a shortfall of £15,000 to be paid in just over 2 years.

It is not the end of the world.

How are your finances apart from this? How old are you and your OH and how long do you intend working for? Can you afford to make regular overpayments or run an ISA alongside with the intention of using that to pay off the mortgage?

Jacka87

I would say that considering the values we are discussing in this case it would prob be best to start looking at cutting your cloth and either putting what you save into mortgage repayments or savings vehicle such as an isa to save the 15k over the next 2 years if it is possible.

The other option would be to remortgage and try to allow yourself greater time to make the repayments, again only if this is possible.

Good Luck

Jazz56

Pee wrote: »

How are your finances apart from this? How old are you and your OH and how long do you intend working for? Can you afford to make regular overpayments or run an ISA alongside with the intention of using that to pay off the mortgage?

OH and I are 51 and 53 respectively. Do not foresee working in current job beyond 8 years. OH is in a heavy job and is not coping now so needs to get out soon as! We are already making regular overpayments on the mortgage to the tune of around £60. Unfortunately the second endowment is underperforming and we have done nothing about it as we were confident this first one would compensate for that. How naive we are!

Our finances are - to put it bluntly - a complete mess and that's partly why I have dived in and started posting here. I need to take control and sort it all out somehow ...

robnye

does your mortgage completion date also finish at the time of the second endowment....

ie i have 3 endowment policies all under acheiving, but there maturity date is a few years before my mortgage end date......
my impression nowadays is that unless your mortgage end date is due up, then the mortgage company arent worrried....

you could continue overpaying - as now
you could ask to extend the mortgage - with every intention of over paying therefore completing it before the new end date

once my endowments have matured and i have paid what little they provide of the mortgage, i will then throw the money at the rest of the mortgage and reduce its term from 17 years to 5.....

nb: just reread your last post...... you sound like you need to assess your incomings/outgoings as well......

Jazz56

robnye wrote: »

does your mortgage completion date also finish at the time of the second endowment....

ie i have 3 endowment policies all under acheiving, but there maturity date is a few years before my mortgage end date......
my impression nowadays is that unless your mortgage end date is due up, then the mortgage company arent worrried....

you could continue overpaying - as now
you could ask to extend the mortgage - with every intention of over paying therefore completing it before the new end date

once my endowments have matured and i have paid what little they provide of the mortgage, i will then throw the money at the rest of the mortgage and reduce its term from 17 years to 5.....

nb: just reread your last post...... you sound like you need to assess your incomings/outgoings as well......

This got me thinking - forgive any inaccuracies, I have a useless memory - original mortgage was taken out in 1986, same time as the first endowment. We remortgaged in around 1990/1 to finance a loft extension, took out another endowment - so I'm fairly sure the answer is yes, 2nd endmt and mortgage end at same time, around 2015 I think.

Please keep it simple people - I don't understand finance at all!

Yes, we urgently need to assess our income and expenditure - was supposed to be starting to draw up a household budget today but got sidetracked with this red letter issue!

Sheesh we are in a right pickle.

Jazz56

So people, I'm still none the wiser - what the hell can we do?
We were counting on the extra money from the endowments. We have paid the premiums every month, year after year, and for what? I'm so cheesed off.

EdInvestor

Post some info about the endowment

Provider
Guaranteed sum assured
Declared bonuses
Surrender value
Monthly premium
Maturity date
Maturity forecasts
Interest rate payable on mortgage.