We'd like to remind Forumites to please avoid political debate on the Forum. This is to keep it a safe and useful space for MoneySaving discussions. Threads that are - or become - political in nature may be removed in line with the Forum’s rules. Thank you for your understanding.

Endowment Advice please!!

My mum wants to surrender her Norwich Union endowment policy.

She managed to get compensation on the policy as she has a shortfall. She was only entitled to half the compensation as the policy is in joint names and her ex is not contactable (he did a runner 5 years ago leaving my mum with lots of debt and the mortage to pay). The house and mortgage were transferred into my mums sole name about 2 years ago but she has kept paying the endowment. We went to the FOS who said that NU were correct in paying my mum just half of the full compensation amount.

Now NU have said that she cannot cancel the policy as it is in joint names but why should she continue paying into this policy when, according to NU, she is not entitled to any of the money that she has paid into it. She has now cancelled the direct debit but she is now worried that they may force her to keep paying into the policy. What would happen when the mortgage is due to be paid in 7 years time? As she has the policy in joint names does this mean that she cannot use it to cover the morntage?

Any advice will be greatefully recieved :D

thanks

Sarah

Comments

  • turbobob
    turbobob Posts: 1,500 Forumite
    How was the mortgage and house was transferred into your mothers name only and why wasn't the endowment policy considered at this time?

    The basic problem is that if, as your post suggests, the endowment is still legally owned by both original applicants then both of them will need to provide authority to make any changes to (or surrender) the endowment. How the policy maturity would work in these circumstances I'm not entirely sure. Possibly along similar lines to how the compensation was dealt with (i.e. your mum gets half of the maturity value).

    I think the only thing that would be able to transfer the policy into your mums name without her ex's authority would be a court order. But this is just a thought, its not my area of expertise. She may be best to get legal and financial advice.
  • Mr_helpful
    Mr_helpful Posts: 3,233 Forumite
    You bettter find the old man a sthe cheque will probably be sent out in joint names too
    I like to give people as many choices as possible to do what I want them to. (Milton H Erickson I think)
  • MortgageMamma
    MortgageMamma Posts: 6,686 Forumite
    Part of the Furniture 1,000 Posts Combo Breaker
    Does your mum still have the contact details of the solicitor who dealt with the finances on seperation? that would be a really good place to start. Did her ex have a soliciotr. Also a good starting point. If she really doesnt know where he is, then a private detective could potentially search for him, but that could get quite costly. What about relatives and friends, could they not assist?
    I am a Mortgage Adviser

    You should note that this site doesn't check my status as a mortgage adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
  • chops05
    chops05 Posts: 178 Forumite
    Part of the Furniture Combo Breaker
    Does your mum still have the contact details of the solicitor who dealt with the finances on seperation? that would be a really good place to start. Did her ex have a soliciotr. Also a good starting point. If she really doesnt know where he is, then a private detective could potentially search for him, but that could get quite costly. What about relatives and friends, could they not assist?

    The solicitor who acted for my mum basically said that the endowment could not be dealt with via the court :confused: seemed a bit strange to me at the time that everything else went via the court and the judge ruled in my mum's favour that the house be signed over to her.

    Her ex was served with papers before it all went to court but he never replied but that was probably because he was actually sent to prison for a bigger crime (long story but nothing that involves my mum thankfully!!).

    Basically my mum's solictor doesn't want anything more to do with this case and just told her to "hope he dies" then she would get all the money. Not very helpful really!!
  • JoeK_3
    JoeK_3 Posts: 1,374 Forumite
    In my opinion, your mum should continue with the endowment policy.

    Investment returns are improving and as a consequence her endowment will have a better chance of accumulating the original target figure.

    Further to this the policy will be made paid up if no further payments are made into it. As the policy does not appear to have been assigned to your mum (something that should have been arranged by her solicitor) she will not be able to surrender the policy as it will require two signatures.

    If you can, ask mum to locate dad and ask him to assign the policy to mum.

    JoeK
    I am an Independent Financial Adviser.
    Anything posted on this forum is for discussion purposes only. It should not be considered financial advice. Different people have different needs and what is right for one person may be different for another. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser who can advise you after finding out more about your situation.
  • katecheshire
    katecheshire Posts: 229 Forumite
    Part of the Furniture Combo Breaker
    What has happened to the other half of the compensation? Is that money still attached to the endowment policy (and continuing to earn interest?).
    Your Mum will need to contact her ex and get him to sign over the endowment to her but she needs to establish with the endowment company that she has been solely paying the premiums since the appropriate date otherwise if she had to split the money (as opposed to it paying off her mortgage) she won't have enough. It's a tricky situation and I would get some better advice and a better solicitor.
    My ex and I agreed (through the Court) to continue to pay half the premiums and split the money at the end as we already had other mortgages. He did initially try to 'buy me off' by offering a ridiculously small amount but I insisted. Maybe your dad could be bought off for a similar derisory sum!! In this case I would encourage it!!
  • chops05
    chops05 Posts: 178 Forumite
    Part of the Furniture Combo Breaker
    The other half of the compensation is being held by Norwich Union in case my mum's ex (thankfully not my dad!!) contacts them and tries to claim compensation.

    As mentioned in my previous post he was in prison but is due for release soon or he may be out already so it's quite difficult to find him plus when he was contacted before he would not reply to any letters from my mum's solicitor so I'm sure there is no way he will want to get policy transferred into my mums name.

    Where can my mum go for further advice?

    She has stopped paying the endowment as she is currently in the throes of putting house on the market and paying off her small mortgage. Whats the point of her paying any more money into an endowment that she cannot cash in? If my mum stayed in the current property and used the endowment to pay off the mortgage whose to say that the Norwich Union will do this if the policy is in joint names and the actual mortgage is in my mums sole name?
  • chops05
    chops05 Posts: 178 Forumite
    Part of the Furniture Combo Breaker
    can anyone point in the right direction of where I can take my mum for further advice about getting at least half of her money back? :confused:
This discussion has been closed.
Meet your Ambassadors

Categories

  • All Categories
  • 346.7K Banking & Borrowing
  • 251.4K Reduce Debt & Boost Income
  • 451.4K Spending & Discounts
  • 238.9K Work, Benefits & Business
  • 614.4K Mortgages, Homes & Bills
  • 174.8K Life & Family
  • 252.1K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 16K Discuss & Feedback
  • 15.1K Coronavirus Support Boards

Is this how you want to be seen?

We see you are using a default avatar. It takes only a few seconds to pick a picture.