Aviva shortfall

Mike_J

A while ago we got one of the dreaded red warning letters on our endowment. We only have a small mortgage and if required could pay it off tomorrow but havent because thanks to a bit of negotiation some years ago we are getting a higher rate on our savings than we are paying on the mortgage.

The endowment was with Norwich Union (now Aviva) who at the time undertook to make up the shortfall (subject to the funds making certain returns). To us this "promise" was worth about £3500. What I was wondering is if the shortfall will be measured against the mortgage debt at the time of maturity or against the sum assured figure.

We have about 4 years left on the mortgage but only about 2 1/2 years left on the deal. The normal logical thing to do would be to pay off the mortgage at the end of the deal period but will this effectivley let Norwich Union off the hook.

dimbo61

will the funds make the return ( not likely!)
Why take out a new deal and pay more interest than you need to!
Wait until your good savings rate ends and clear the mortgage
Aviva may pay you the extra but why chance it
You could in 4 years have far more saved without aviva
Whatever you do get from Aviva can go into your savings/pension pot.
Good Luck ( only my opinion!)

dunstonh

The mortgage promise is fully funded and is being paid on maturities. The maximum mortgage promise value is that which was set in 2001 (also verified again on the 2004 statement and can be found out from Aviva although the telephone staff often dont know anything about the promise value until you tell them).