Mortgage company messed up - can I claim?

robotwars

Three years ago I took out a final 3 year fixed rate deal with our building society to take us to the end of our 25 year mortgage term. We had 2 endowment policies with same insurance co. maturing a couple of months apart (the first for majority of debt, latter one only for £1000). I asked the BS to unlink the mortgage from the endowment policy as I knew that the first policy would mature a couple of months before the fixed rate deal ended and if it was paid direct to BS we would be liable for early redemption penalties of £1500. The BS sent us a quote showing change to 'interest without repayment vehicle' for 3 year term which we signed and sent back, then later sent a product transfer offer which stated 'interest only' and 'we do not hold details of any repayment vehicle you have' which we also signed and sent back. Morgage statements since also say 'Interest only'.

So as far as we were concerned we were in int only without RV and endowment proceeds would be paid to us to then pay to BS at end of fixed rate term. Last week we received a letter from insurance company saying that policy 1 will mature on 6th Jan and will be paid direct to BS to pay off mortgage debt. Contacting BS we were told we had never been changed to int only without RV. :mad:
They say that they have no record of receipt of our acceptance of the first quote and that they did receive the subseqenet signed product transfer doc, but can't explain why we we were not changed to int only without RV. (Apparently 'int only' on documents can also apply to mortgage with endowment.) They have now said that they will send us out a new agreement to change to int without RV and will forward to insurance co to try and get them to send cheque to us (may not happens with Christmas/post problems) but if they do receive the cheque, they will cash it and send us the money. They are absolutely not accepting responsibility for the errors, saying that they never received the original quote acceptance. Although I am glad that I have (hopefully) been able to sort this out before I got hit for penalties (by speaking to their complaints dept), I am mad that they don't think they've done anything wrong think it is now all sorted. I have quite a lot of correspondence form 3 years ago about implications of changing vs not changing to int only without RV and about another error they made with the mortgage term. Any ideas how to pursue this further, or should I just drop it?

Crinz

what do you want to persue?

they made a mistake (whether they admit it or not) and they have fixed that mistake by saying the funds will be sent to you if they receive them.

What is your end goal and then we can say if it is worth following through or not

dwsjarcmcd

Unless they charge you ERC's then I would drop it. You won't lose out financially so it's not worth going through the pain to make a point. My thoughts anyway

dunstonh

I asked the BS to unlink the mortgage from the endowment policy

There were never linked to begin with.

Contacting BS we were told we had never been changed to int only without RV.

What difference does it make?

They have now said that they will send us out a new agreement to change to int without RV and will forward to insurance co to try and get them to send cheque to us

That would only happen if the endowment policy is assigned to the lender. Most are not. Some old ones are. The insurance company will be able to tell you if it is or isnt. Lenders havent required assignment for around 15 years.

I am mad that they don't think they've done anything wrong think it is now all sorted.

I have to admit that I cant see what difference it makes and what you are trying to achieve.

Any ideas how to pursue this further, or should I just drop it?

You are not financially out of pocket. The endowment is not and never had been directly linked to the mortgage. Admin tasks often do not have a long audit trail history as there is no reason for them. So "missing" records on an admin task are not unusual as they are probably long destroyed.

All you need to do here is make sure that the endowment policies are not assigned to a lender. If they are, then get the lender to write to the insurer saying they have no interest in the policies. If they are not then all this admin you are creating is totally unnecessary.