Endowment mortgage help for family

DireDebts

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Simon_gloster

Endowments will show projections on a yearly basis providing information as to whether the plan is on track or not. You will need this.

If it was a 25 yr term mortgage, there is probably 7 yeas left to run. Should there be a shortfall, the debt will still need to be paid potentially on a repayment basis. Better find this info out sooner rather than later.

How much is outstanding on the mortgage.

Froggitt

eligible plan would meet its targeted value at maturity as long as the "6% a year test" was met

was the original MEP. IIRC, it was later changed, and you will only know at maturity what the promise if worth......assume nothing IMHO.

The endowment will show a short fall but she does not know how much

Every year, SL must send a letter showing what the shortfall is assuming various levels of growth eg 4% 6% 8%. Even 4% could be optimistic.

How big is the mortgage? How much was the endowment planned to pay? How much is the shortfall at 4%?

How old is your relly? eg if they were due to retire around the end of the mortgage, they have seven years to save up for the shortfall. Or do they want to spread the shortfall over a longer period of time?

Most suggestions here I suspect will be to put the shortfall onto repayment basis, over a period of time that is affordable and realistic. If the shortfall is too big, and its not affordable in the period of time, they will need to consider other options eg downsizing.

opinions4u

Don't forget they also got some Standard Life shares. These will have a decent value if still held.

Standard Life tell her that she has the mortgage endowment promise but the papers they have sent her can not allow her to work out if this will help.

The amount will vary depending on how well the policy is performing. Good policy = lower MEP. Bad policy = higher MEP.

A phone call should get you put through to somebody who can give you a current value. But it will change.

Froggitt

Investment Return Test and the 6% a year test and the accelerated rate and reduction rate and cessation rate

It means they wont know how much you will get until the endowment matures.

How much did the last shortfall letter say it would be?