Red alert for endowment/Paying off mortgage

groanie

I have two queries, I hope someone can advise me;

1)I have had a red alert for my endowment ( approx 8,000) from Aviva and the letter suggests I should make a claim . However, I have already had a payment of about £2,000 from the Abbey for 'mis-selling'. Do both companies not liaise with each other? Surely I cannot make a claim to Aviva as well?
They also state that at the end of the term, I will get a guaranteed £3,000 payment off the outstanding amount.
( My mortgage was obtained through an Abbey National branch with the Insurance then through Norwich Union)

2)I only have about 2 years left on my repayment mortgage and as I have been left about £2,000 from a will, I wondered if I should put this towards the mortgage? Abbey says there is no penalty. I am currently paying interest at 4.25%. I have a bit of savings, so this money is an extra bonus. It does not seem to be worthwhile putting it into a savings account at the moment (unless anyone knows better?)

I do not have much savvy about these things!!

dunstonh

1)I have had a red alert for my endowment ( approx 8,000) from Aviva and the letter suggests I should make a claim . However, I have already had a payment of about £2,000 from the Abbey for 'mis-selling'. Do both companies not liaise with each other? Surely I cannot make a claim to Aviva as well?

No the companies do not liase with each other. There is no reason for them to do so. However Aviva have no liability. So, you cant complain to them.

EdInvestor

Post some info on the endowment

Guaranteed sum assured
Declared bonuses
Surrender value
Monthly premium
Maturity date
Maturity forecast
interest rate payable on mortgage

You cannot make a second claim on the same endowment.They do not liaise.Is the guaranteed payment the 'mortgage promise'?

Voyager2002

Yes, it is always a good idea to use "spare" money to reduce your mortgage, so long as there are no penalties. But consider whether it really is 'spare': if you need to repair your house or change your car, now is probably a good time to do so.

groanie

Thank you EdInvestor. In reply, here are the details relating to the policy, which is a
' Guaranteed minimum Cost End, participating in ConvOB Endowment Compound Series Bonuses' !!?

Guaranteed Sum assured £11.696.00
Declared bonuses £9276.25
Surrender value £18.518.40
Monthly premium £44.86
Maturity date Sep 2011
Maturity forecast @4% £21.800

The guaranteed payment is the 'Mortgage promise' (£3,200.00)

This is all double dutch to me!

EdInvestor

Please post the interest rate on the mortgage.

groanie

Interest rate is 4.25%

Thank you

getmore4less

Not sure what yo are asking.

You say you have a repayment mortgage?

If this is the case then the endowment is just a savings scheme.


What's the current outstanding mortgage?

EdInvestor

groanie wrote: »

Maturity forecast @4% £21.800

The guaranteed payment is the 'Mortgage promise' (£3,200.00)

If you cashed in the policy and used the lump sum to reduce the mortgage, also increasing the monthly mortgage payment by the amount of the endowment premium, your total return at maturity would be £21,254, that's with no risk.

However that's not much more than the existing guaranteed value of £20,972 and excludes any mortgage promise amount.There's also the possibility that the Aviva WP fund will do a bit better than 4% over the next 2 years.

I would hold onto this policy for now but be prepared to kick up a fuss at maturity if there is any attempt not to pay the mortgage promise amount, which is not guaranteed.There have been reports that less aware policyholders have not been paid as promised.Because the guaranteed value is high, you won't lose by sticking round, so you may as well go for it.

groanie

Thank you for your advice. Much appreciated.

HAVEFAITH

groanie wrote: »

Thank you for your advice. Much appreciated.

hi how did you get on? any success with your investigations etc?