Endowment shortfall - best options please

georgiac

My mortgage has around 7 years to run, and I look like have an endowment shortfall of about £25000.

I'm not at all financially savvy and have really buried my head i the sand until now. STOOOPID, I know.

I have spoken to my bank and they say if I pay an extra £200 a month that should just about cover it.

Would this be my best bet or should I look at other options?

Any help much appreciated.

Thrugelmir

What rate of interest are you currently paying on your mortgage?

georgiac

It is 3.5%

SKIPPY

Is that an extra £200 per month directly off your mortgage or an increase in your monthly endowment payment. I'm in the same boat with an endowment shortfall, the endowment company wanted to increase my monthly payment to cover the shortfall but could still not guarantee that the policy would pay what it should do, so I paid the money into a savings account to cover the shortfall.

Thrugelmir

georgiac wrote: »

It is 3.5%

Personally I would increase the amount paid into the mortgage account at this interest rate.

If anything paying slightly higher than the £200 suggested, and therefore allowing for the endowment policy to fall even further short.

georgiac

Hi Thrugelmir

My mortgage is pretty low so I am in a position to be able to afford the extra £200 a month so I will probably take that option.

Does 3.5% seem a reasonable intrest rate to you?

Thanks

Thrugelmir

georgiac wrote: »

Hi Thrugelmir

My mortgage is pretty low so I am in a position to be able to afford the extra £200 a month so I will probably take that option.

Does 3.5% seem a reasonable intrest rate to you?

Thanks

Certainly not a bad interest rate in the current market.

To obtain a far better rate you would need a good LTV.

How much is your property worth and what's your outstanding mortgage balance?