We'd like to remind Forumites to please avoid political debate on the Forum... Read More »
We're aware that some users are experiencing technical issues which the team are working to resolve. See the Community Noticeboard for more info. Thank you for your patience.
📨 Have you signed up to the Forum's new Email Digest yet? Get a selection of trending threads sent straight to your inbox daily, weekly or monthly!
Mortgage/endowment - sane plan ?
Options

beaker12uk
Posts: 7 Forumite
I am looking at my mortgage and endowment with a view to the future.
Do I stick or move mortgage ?
Do I keep/sell endowment ?
My circumstances have changed (new baby), so 1 less wage coming in so I need to reduce out goings.
My mortgage First direct offset 6% (but have been offered 5.5% fixed for 3 yrs)
I have £100k left to pay.
I was looking at woolwich 4.98% fixed for 10yrs but I am not happy with only 5% overpayments per month if my finances improve, and being tied in for 10 yrs.
So I have thought that if I accept the 5.5% fixed with first direct and sell my endowment, to give me good savings to offset the mortgage, i might also meet the approx 5% that woolwich were offering with no tie ins and options for early redemption or overpayments.
Is this a good idea ?
The endowment is :-
Freinds prov with profits 12 yrs to go
orig target amount £57k
4% - £35,800
5.5% - £40,800
8% - £50,900
I pay £127 a month (cannot afford this any longer !)
total paid in £ 12,108
surrender to FP £10,458
If i sold this I could maybe make more than 12k and reduce my mortgage to 88k, hence less mortgage payments and no endowment payments.
your views please ?
Do I stick or move mortgage ?
Do I keep/sell endowment ?
My circumstances have changed (new baby), so 1 less wage coming in so I need to reduce out goings.
My mortgage First direct offset 6% (but have been offered 5.5% fixed for 3 yrs)
I have £100k left to pay.
I was looking at woolwich 4.98% fixed for 10yrs but I am not happy with only 5% overpayments per month if my finances improve, and being tied in for 10 yrs.
So I have thought that if I accept the 5.5% fixed with first direct and sell my endowment, to give me good savings to offset the mortgage, i might also meet the approx 5% that woolwich were offering with no tie ins and options for early redemption or overpayments.
Is this a good idea ?
The endowment is :-
Freinds prov with profits 12 yrs to go
orig target amount £57k
4% - £35,800
5.5% - £40,800
8% - £50,900
I pay £127 a month (cannot afford this any longer !)
total paid in £ 12,108
surrender to FP £10,458
If i sold this I could maybe make more than 12k and reduce my mortgage to 88k, hence less mortgage payments and no endowment payments.
your views please ?

0
Comments
-
beaker12uk wrote:I was looking at woolwich 4.98% fixed for 10yrs but I am not happy with only 5% overpayments per month if my finances improve, and being tied in for 10 yrs.
4% - £35,800
5.5% - £40,800
8% - £50,900
Re the endowment, if you surrender it and use the money and the premiums to offset or overpay your mortgage @5%, then your return at maturity would be 43,691.
The FP endowment is unlikely to return more than 4.5% at best ( and this is not of course guaranteed) and is unlikely to attract any interest from TEP traders.
If you need the life cover, be sure to replace it before surrendering the endowment.Trying to keep it simple...0
This discussion has been closed.
Confirm your email address to Create Threads and Reply

Categories
- All Categories
- 350.9K Banking & Borrowing
- 253.1K Reduce Debt & Boost Income
- 453.5K Spending & Discounts
- 243.9K Work, Benefits & Business
- 598.8K Mortgages, Homes & Bills
- 176.9K Life & Family
- 257.2K Travel & Transport
- 1.5M Hobbies & Leisure
- 16.1K Discuss & Feedback
- 37.6K Read-Only Boards