Endowment - is this the end of the road for us?

Swany_3

We took out an endowment mortgage in the early 80s and were advised this would cover the mortgage with a little extra to boot. The company who sold it to us ceased trading some time ago although it still exists as an insurance company. Standard Life have advised that the policy will not meet the final payment. The FOS have informed us that we are at the end of the road. Anyone have any advice?

Terry_D

Swany wrote:

We took out an endowment mortgage in the early 80s and were advised this would cover the mortgage with a little extra to boot. The company who sold it to us ceased trading some time ago although it still exists as an insurance company. Standard Life have advised that the policy will not meet the final payment. The FOS have informed us that we are at the end of the road. Anyone have any advice?

Have you tried the FSCS? We did and eventually got £2.5k compo. The form is a bit daunting but this was our last try and it paid off.

EdInvestor

The FSCS only covers sales after 1988 when regulation started so it does look as though there's no more you can do.

Is the policy in shortfall? Policies of that age benefitted from from tax relief so are usually on schedule to pay off the mortgage IME.

Swany_3

Thanks for that but, yes, we have. They will only take up claims after 1988 and ours was taken out in the early 80s.

Terry_D wrote:

Have you tried the FSCS? We did and eventually got £2.5k compo. The form is a bit daunting but this was our last try and it paid off.

dunstonh

If yours was taken out in the early 80s, this means its getting LAPR (tax relief) and would almost certainly be 25 years. I would expect a Standard Life one to virtually hit target or come close.

Even if you could complain and it was upheld, the LAPR would have made the endowment mortgage much cheaper than the repayment mortgage and it would be unlikely that any redress was due.

Standard Life illustrative examples are known for their inaccuracy. They project from the surrender value and not the current value as these old plans never had a current value. This automatically gives lower than likely values which could run into thousands. Plus, what you are getting are only examples if certain rates of return are achieved. It could be more or less. It is not guaranteed. Recent news articles have suggested that the average 25 year endowment will hit target and pay a surplus. Whilst that is no guarantee, it is enough to make sure you look at the policy in a little more detail than just what a possible projection may be.