Report Endowment Misselling Compensation SUCCESSES

midge100

hi

just a note to say give it a go. We had an endowment mortgage in 95, after reading all the bad press decided to surrender policy in 03 (cash helped towards new kitchen, so was great help at the time) and changed to repayment, then thought nothing more about it. A friend had just received compensation for a policy she had sold so I thought I would give it a go. Made one phone call in April (had no policy details, no's etc but they found it all with my Post Code) had one form to fill in and then today received offer of nearly £3000, still a bit stunned that it was so easy wish reclaiming bank charges was the same, but still working on that one!!!!!

Nothing ventured nothing gained as they say.

starfish10

I have just found time to sort through mounds of paperwork. On the 15th of May 2006 I got a letter back from the company who sold us our endowment, saying that they feel they are not responsible of misselling. We took it out in June 1987 and it matures in December 2007. it could be about 4 to 5 thousand pounds short. Is it too late now for me to take this further.

Dutchy127

I received an offer of £950.- compensation on a £40,000.- endowment. Can I ask for more? Has anyone done this yet? My endowment is with Legal and General. Any views on wether I should cash-in my endowment now or let it mature...

dunstonh

I received an offer of £950.- compensation on a £40,000.- endowment. Can I ask for more?

You can ask for a recalculation but with the markets hitting a record high on Friday, you should be prepared to be offered less than £950.

The calculation is defined and unless the input data is incorrect, the outcome will be correct.

My endowment is with Legal and General. Any views on wether I should cash-in my endowment now or let it mature...

If your surrender penalty is more than £950 then you are actually financially better off with the endowment than on a repayment mortgage. L&G have some very good endowments (as well as some not so good).

terrierlady

my brother had mortgage for 47.000 just coming to an end but had shortfall due to endowment, he is still paying a mortgage 3 years after due to retire, followed Martins advise and reclaimed compo of just over £7,000 they did agree his loses amounted to over 13,000 so unsure how they calculate refund would it be worth trying for uplift?They have given 90 days to accept the offer.

kmac99

Policy from Friends Provident
Compensation £3600

Policy was to cover mortgage of £36000 by 2015 - shortfall was going to be £12000 to £18000! according to warning letter
Form filling was a bit daunting, but manageable and I made claim through Ombudsman. Received offer for above amount after about 6 months (there were some problems tracing one of my old mortgage accounts), so worth the wait!

Willy_3

Policy With: Guardian Rotal Exchange
Compensation: £4067

We took out an endowment mortgage £38000, in 1994, but having got worried about the problems with endowments not repaying, changed to repayment in 1997.
We maintained the endowment as life assurance to cover the mortgage, and also to pay of the repayment mortgage early.
GRE did send warning letters, encouraged us to increase the payments to the endowment, and sent the the final warning letter. Finally, thanks to MSE constantly nagging, early 2007 I sent a letter claiming misselling due to not enough emphasis being placed on the dangers of a shortfall. GRE sent a letter back saying they had given fair warning, met industry guidlines etc. Oh well, I thought, nothing ventured, nothing gained.

Three weeks ago, GRE sent us a letter saying they would review the claim, as part of a continuous process of re-assessment (?) or some such. We completed a form saying that we would this to happen.

This week we were offered just over £4000 in compensation, which will go towards the new kitchen that we are now planning for!

Many thanks to Martin, and the people who post here at MSE. Since joining, I have saved and made money, which goes a long way to making life better!

ribby

Bank / Provider - Norwich Union (bought via Leeds Permanent)
Compensation - £5.4k
2x Endowments bought in '90(26K) and '91(34K).

Basically, we had our head in the sand on this, and swapped to a repayment mortgage a couple of years ago...
With looking at this site, and Which?, we sent in an initial letter to HBOS (they 'bought' Leeds Permanent) on the 22nd May. They replied stating that it was the Norwich Union with whom we may have a complaint with - and they forwarded on our letter. The NU then replied with some questionnaires... and gave us 2 weeks to respond. We responded towards the end of these 2 weeks, but they have already sent us an offer before they have got our responses.

We are thinking of accepting the offer BUT keeping the endowments as a saving fund, and just checking the small print...

So, in 5 weeks, with just a simple letter created from the Which? one, we have a good result, and I must praise the NU for they speedy and professional responses.

Many Thanks - and good luck.

ellives

Lots of questions PLEASE bear with me and have a stab at the questions if you have some solid-ish advice...........

After carrying the documents in my briefcase for over two years, I finally chucked them in the bin...........then fished them out again at the end of the day - read the documents properly, realised I could basically avoid detailing much to make the claim, so sent it off.......

The upshot is that today I received an offer of £1628 (better than nowt).

Some details:

Nationwide PEP/ISA for £70,500 to cover a mortgage - 23 years (£55/month)
Started in April 1997. Changed to full repayment in June 2006.

Approx. 10 years in, it was forecast to hit approx. 50% (ie £35k) on completion (ie after 23 years). To me, £1628 doesn't sound much to compensate for such a crappy product - it doesn't seem comparable to other payments received that have been listed on here either?

Here is what the blurb states:

Capital comparison
outstanding mortgage £33149 (not sure what this represents)?
balance of equiv. repayment mortgage £24880
difference £8268

outgoings during mortgage period
comp. cost of my mortgage £33865
equiv. repayment mortgage £33078
difference in outgoings £786

mitigation - conversion to C&I
differnces in balances plus higher outgoings £9055
plus refund of premiums + interest at 8% £819
less surrender value at 19 July 07 £8246

total redress £1628

To be honest, I'm unsure whether this is a decent offer or not. I do appreciate that it is based on a prescribed model and so unlikely to be a low bid that they'll negotiate up if I push them. What I'm wondering is have they based the calculation on the correct information - just seems a big gap?

So, questions:

- does it seem okay?
- has it cost me to allow them to base it on Nationwide's variable rates (I actually got a decent fixed rate for the entire period)?
- why do they say the outstanding mortgage balance is £33149? Surely if it was £70550 to start with (10 years ago) and the premium is worth £9k today, this doesn't add up?
- finally, my girlfriend at the time (wife now) has an identical policy (can't quite remember why were were sold two for £70k each when the mortgage was £70k)? It is still in her maiden name and at an old address - so perhaps not obviously linked to this claim. I have not mentioned this - how should I approach this claim?

Thanks, in advance.

dunstonh

To me, £1628 doesn't sound much to compensate for such a crappy product

Its not that crappy, thats why. ISA/PEP linked mortgages are better than endowment. Technically its how I have mine set up and its about 40% higher than where it needs to be. The few I have on my books are in similar positions.

The only possible crappy bit is that the Nationwide fund will be mid table performance if you are lucky. The concept and product are fine, the fund is probably lacking a bit. That said, you would expect it to hit target over the long run.

it doesn't seem comparable to other payments received that have been listed on here either?

A lot of the examples on here include the value of the policy in the redress. So that inflates them. Plus we have had four years of good growth on the stockmarkets and redress payments are either very low or non existent nowadays as many endowments and ISA/PEPs have got back on track.

The last crash was a good thing for you. It puts you off target in the short term but you get to buy units much cheaper. When it recovers those cheaper units are the ones that have the highest gains.

To be honest, I'm unsure whether this is a decent offer or not. I do appreciate that it is based on a prescribed model and so unlikely to be a low bid that they'll negotiate up if I push them. What I'm wondering is have they based the calculation on the correct information - just seems a big gap?

The calculation seems ok.

- has it cost me to allow them to base it on Nationwide's variable rates (I actually got a decent fixed rate for the entire period)?

lower interest rates favour repayment mortgages over interest only with investment vehicle as far as cost difference is concerned (although ironically this suits investments better as the cost of borrowing is less and the gap between what you pay and what your returns are is usually higher, and better).

- why do they say the outstanding mortgage balance is £33149? Surely if it was £70550 to start with (10 years ago) and the premium is worth £9k today, this doesn't add up?

That is because only half the endowment is interest only. Not all of it. There is no way £55pm over 20 years was ever going to get £70,500. It would be more consistent with around £33k. I expect the rest of your mortgage is repayment basis.

- finally, my girlfriend at the time (wife now) has an identical policy (can't quite remember why were were sold two for £70k each when the mortgage was £70k)? It is still in her maiden name and at an old address - so perhaps not obviously linked to this claim. I have not mentioned this - how should I approach this claim?

You should have done both at the same time.

This actually explains the comments I made above (i didnt read ahead ). It appears they have reviewed your half of the mortgage as a complaint and not both halves. Probably as the name and address were different.

So, when you put both halves together, you get your £70,500.

All seems valid so far and you should accept the offer. Switching the ISAs to a fund supermarket and picking better funds would be a good idea. This can be done at zero cost and offers the potential for better returns. Exactly the same concept as you are now but using better quality funds.