Do I have a claim?

anitak

Hi there. so much info floating about, its hard to find anything.
So best if I ask if anyone knows - I was sold an L&G pep/unit trust linked vehicle in 1997to pay off a mortgage, so am just paying the principle. I have paperwork that covers all the bases but in conversation the FA said that it was basically assured that the mortgage would be paid off by this maturing. Of course I now only have 23 days till time runs out - EEK!
Do you think I have a case - or is this merely hearsay? Is there anything in particular I need to put into my letter to them (DBS)? Any helful hints gratefully received!
Thank you for listening.....

Ian_W

Why should you have a claim?

AFAIK the mis-selling deadline applies only to ENDOWMENT mortgages - see
https://www.financial-ombudsman.org.uk/faq/mortgage.htm

A PEP/ISA arrangement is transparently a stock market investment which you can find out the value of on a daily basis, totally different from an endowment, particularly a "with profits" one which is only valued annually. Even then in a very obtuse and confusing way.

What are you claiming compo for? Is it under-performing? For probably 6 or 7 out of the 9yrs you've had the arrangement the markets have performed well to very well and even when there was a slump your monthly contributions would have been buying shares cheap which will by now have gone up substantially.

Do you have any proof of what you say the FA told you? I'm fairly sure the paperwork won't have said that.

If you're not happy to continue with the ISA/PEP arrangement, get a valuation and consider selling it and paying that into the mortgage at a time when you can do so without penalty and take out a repayment mortgage.

The whole compo scheme is daft IMHO but it is designed to put those with endowments in no worse position than if they'd had a repayment mortgage from day 1. Nothing you've posted suggests you are worse off so what are you seeking compo for?

dunstonh

PEP/ISA linked mortgages are generally much better than endowment mortgages and offer far greater potential for better returns. Although it very much depends on the investment funds utilised. I wouldn't be using L&G for example but over the long term it should be ok.

As it happens, the stock market crash of 01/02 was great news for you. In the short term it hits values but it does mean that you were buying units much cheaper during the following years and it will be those that make the most money over the term.

Your best approach is to get the funds reviewed as its nearly 10 years on and investment options today are a lot better than 10 years ago and you can switch them free of charge and without hassle. This could also reduce charges and that will help increase the likelihood of hitting target and achieving surplus.

jamesd

dunstonh, could the FA have ongoing servicing advice liability for investment selection in such a case? If so, a complete lack of attention to such ongoing investment advice might prove interesting.

anitak

Thanks very much for replies so far, but I am ever increasingly confused! The mortgage type that I have taken out is endowment on the Abbey paperwork, and I have generally understood this to the case. My L&G paperwork refers to it as a Flexible Mortgage Plan and it includes Life Assurance. L&G are the ones who have made me aware of the likely shortfall (£18k on £82k loan) and that I have only a very limited period now in which to act. I admit they have alerted me earlier but I was pregnant at the time and have not been able to think about any of this until very recently when I found this site.

I cant beleive how naive I was in 97 when all this was going on - and the other difficulty I now face on this is that this property is now rented and I am struggling to change the repayment type. The Abbey dont want to know. A hideous final nail in this saga is that the property now appears to be suffering from subsidence, so selling isnt an option just yet.

I feel so weighed down with all this and cant seem to find good advice, or anyone willing to help - hence airing it here. Any further thoughts you have would be greatly appreciated.

AnitaK

defender_of_the_weak

Deadline applies to PEP/ISA plans just as much as endowments. The FMP was a hybrid if memory serves, but the same mis-selling rules apply. It will all depend on the quality of the documentation and reasoning in support of the sale.

If you only have 23 days left and you honestly believe you were mis-sold, it may be an idea to contact Sesame(DBS) and lodge a formal complaint to give yourself time to investigate further. Don't expect them to give you unlimited time to deal with enquiries. Sesame try to manage as many complaints as possible out of the system

dunstonh

jamesd wrote:

dunstonh, could the FA have ongoing servicing advice liability for investment selection in such a case? If so, a complete lack of attention to such ongoing investment advice might prove interesting.

DBS terms of business was a single transaction only and not for ongoing advice. It was basically advice when requested.

The mortgage type that I have taken out is endowment on the Abbey paperwork, and I have generally understood this to the case.

Thats an error by Abbey. Your mortgage type is interest only. However, that is irrelevent and back in those days they may have only had repayment or endowment to pick from in their list and endowment is the closest match.

L&G are the ones who have made me aware of the likely shortfall (£18k on £82k loan)

It is not a likely shortfall. It is a projection using set projection rates which may or may not be understating or overstating the real potential of the investment. For example, the rate used maybe 7% but for the last 3 years you would almost certainly have been in double figures with the rate of return and performing better than the projection.

I cant beleive how naive I was in 97 when all this was going on - and the other difficulty I now face on this is that this property is now rented and I am struggling to change the repayment type. The Abbey dont want to know. A hideous final nail in this saga is that the property now appears to be suffering from subsidence, so selling isnt an option just yet.

You may be worrying for nothing. You should get a proper review of the investment to see how it really stands.

anitak

Thanks to all for your responses. My New Years Resolution - to find an IFA TOMORROW!!! I realise this is going to be a hard task though as not one person I have asked has actaully had anything good to say about THEIR IFA's!!! The one I had before got me into this mess, and I am bored rigid after five minutes with him too.
Anyone know someone who can talk straight and get to the point with out jargon in North London?
Thanks again. And Happy 007.

dunstonh

I realise this is going to be a hard task though as not one person I have asked has actaully had anything good to say about THEIR IFA's!!!

Most people have never seen an IFA. Most people see tied agents or mortgage advisers. Chances are they are mixing their terminology up.

EdInvestor

L&G are the ones who have made me aware of the likely shortfall (£18k on £82k loan) and that I have only a very limited period now in which to act....
I cant beleive how naive I was in 97

You don't mean 1987, do you?

Could it be that you have a 20-year 82k mortgage which is imminently due to be repaid in 2007 and a PEP/unit trust worth 64k alongside it?

If so, sorting this all becomes fairly easy

anitak

Thanks - maybe everyone is mixed up, but I have asked all round!
This was DEFINITELY 1997, still l ooking for that IFA....
Cheers