Endowment meltdown: Just one in 100 will pay off the mortgage

Pobby

I had an endowment mortgage for £58k. Was told that it should pay out £120k at maturity. Down sized and didn`t need it. Phoned the provider to see what it was worth, about 6 years before maturity. They said £26k. Phoned the next month and they said £28k, so thought that I may as well cash it in. Asked one or two financial guys why it had gained 2k and they were not sure. Asked for the papers for surrender and they came through with that figure stated. This was about 18 months ago.

Filled in the forms and got the cheque. About 5 months later I had a letter asking for 2k back from me, they had got the figures wrong. Oh dear, what a shame. Since then we have had pleading letters, threatening letters. Havn`t bothered to reply. So they guessed at £120k, at maturity, had I left it running it might have made 30k something and now the poor dears got their sums wrong and are pleading against a full and final settlement.

I don`t want to rip anyone off but for goodness sakes!

nearlyrich

I got my first mortgage in 1982, resisted the Halifax push to get an endowment mortgage, it just sounded too good to be true, been a cynical moneysaver for a long time LOL.

Generali

If you want to see who gains from endowment policies, take a look at the Prudential building in Holborn.

cogito

The people who complain about endowments are probably the same ones who celebrated when interest rates came down meaning that their mortgages cost less. Were they so stupid that they failed to see a connection?

vivatifosi

Are there really people out there still who have endowments, but have ignored all the letters and just carried on paying without looking at alternative repayment methods?

I find mine quite useful. Having been treated for cancer and found myself persona non grata in the life insurance stakes, at least I have something that will pay out if I die young.

But connected to the mortgage? Hasn't been for years. I know quite a few people that have/have had endowments, but can't think of any that have failed to act in one way or another, so I can't see where this huge base of distressed sellers with endowments are going to come from. At least people with endowments will have taken out their mortgages before house prices went up to the rates that they are at now. Shouldn't we be more worried about people with interest-only mortgages who haven't yet considered repayment vehicles?

Thrugelmir

amcluesent wrote: »

Should be some bargains for BTL LLs when distressed sellers have to auction their property as there's not enough in the pot to redeem the mortgage!

Out of interest where do you think that are they going to raise the capital to buy the properties?

Majority of BTL investors are on interest only mortgages. So they have problems of their own!

Californication

Generali wrote: »

If you want to see who gains from endowment policies, take a look at the Prudential building in Holborn.

If they ever convert that into flats, I want the tall, spikey bit in the middle

Generali

Californication wrote: »

If they ever convert that into flats, I want the tall, spikey bit in the middle

It's an amazing building. Paid for by a whole load of 1/2%s. The quad in the middle is open for public access. There used to be an excellent and very cheap Italian just up the road (next to St Brides church) where you could buy lunch in the summer and sit in there to eat while pondering the ethics of the financial services industry.

amcluesent

>It's an amazing building<

English Heritage have their swanky London HQ there (Waterhouse Sq, the internal courtyard at the rear of the Prudential Assurance building).

Another quango that certainly knows how to spend taxpayers money! Why aren't they out in Peterborough?