Endowment - missold although no longer linked to house?

AstonDB6

Hi All

We have an endowment policy that was linked to our first house. About seven years ago we moved and remortgaged to a repayment policy. Can we claim due to mis-selling even though the policy is no longer 'part' of a mortgage?

Thanks

Alan

vinno65

Hi astondb6

the short answer is yes though if you have been miss-sold redress will only be calculated up till you switched to a repayment

regards Vinno

dunstonh

... and 7 years ago puts it before the stockmarket crash and was probably in a surplus position at that point.

Gorgeous_George

vinno65 wrote:

Hi astondb6

.... if you have been miss-sold redress will only be calculated up till you switched to a repayment

regards Vinno

Is there a short answer as to why that should matter?

Thanks

GG

AstonDB6

Yes I switched it because I had become more aware of what an endowment really was and I didn't want to take out a larger one for the bigger house we were buying. I decided to keep the endowment policy as a form of saving - a decision made for me by the valuation they gave me at the time.

I took out a repayment mortgage which I will be paying right up to retirement date, but the plan is to drastically reduce it when the endowment pays out in 2013.

I definitely got duff advice, they said (all verbal, nowt in writing) that I would definitely get the value of the mortgage - the only question was how much extra I would get.

When I realised that was rubbish and we were moving anyway, I decided not to make matters worse by getting another one.

It was almost certainly doing fine at the time we switched - I'll check.

Alan

vinno65

Hi Gorgeous George,
Yes it does matter as Dunstonh pointed out 7 years ago was before the stock market collapse and so the endowment may well have been performing well. How this affects Astondb6 is that even if his complaint is upheld he may not be due any redress as at the time he converted to a repayment (which is the point up to which they will calculate it) the surrender value of the endowment may have been more than what he would have paid of in capital on a repayment mortgage. If Astonbdb6 had kept the endowment mortgage running and redress was calculated now (after the stock market crash) he may well have been due compensation. By doing what he though was the right thing in changing to a repayment mortgage 7 years ago he may well have let the endowment company off the hook. This is why the whole thing is a complete farce! Most people were promised verbally that their endowment would pay off their mortgage at maturity. So endowments should be allowed to run to maturity and if their is a shortfall then the endowment companies should make it up. However with the collusion of the FSA and the FOS (and I suspect up to government level aswell) It has been decided that their are time limits for complaining and so endowment complaint are being settled now.
regards Vinno

AstonDB6

I have until October 2006 to complain. I know this because I was sent the first warning in Oct 2003:

Projected shortfall (£90,000 endowment) £18,600 (4%) £6,600 (6%). At 8% they projected a £13,000 surplus.

In Sep 2005 I got this:

Projected shortfall £33,300 (4%) £23,500 (6%) £11,000 (8%).

I agree with you guys unfortunately Because I separated the endowment from the mortgage while it was performing OK, I won't get any compensation :mad: and yet the end result is the same. In 2013, instead of paying off £90,000 of my current mortgage, I'll be paying off somewhere between £60,000 and £90,000 because of a risk I didn't realise I was taking at the time I purchased the endowment.

BACKFRMTHEEDGE

You should find out what the surrender value is and ask the guys on here if it's worth surrendering or keeping.....mostly it seems to come back as surrender>>>> :rolleyes:

dunstonh

BACKFRMTHEEDGE wrote:

You should find out what the surrender value is and ask the guys on here if it's worth surrendering or keeping.....mostly it seems to come back as surrender>>>> :rolleyes:

Which is often correct but the paid up option is usually ignored here. As it can make sense to make plans paid up for certain periods before surrender, ignoring that option could result in the unnecessary loss of thousands of pounts.

So, whilst it is useful for guidence to have your figures looked at, you do have to remember that not all options are being reviewed and if you rely on the information here only it could cost you a lot of money.

bluenose1

I have a Standard Life endowment policy. I moved house and changed to a repayment mortgage in 2001.
Now just using it as a savings policy.
I have been offered compensation of £2200 for period 1989 to 2001 for mis-selling so it is definitely worth claiming.:j

Originally they calculated 1989 - 1996 and offered £2271. For some reason when they calculated to 2001 it reduced slightly.

I copied the Which letter and it took me no more than an hour to sort it.
Good luck
Anne

dunstonh

1996-2001 had good performance.