2nd Claim for mis-sold endowment?

lulabelle81

We currently have an interest only mortgage with Abbey and an endowment to the sum of 55k.
After receiving a shortfall warning letter, we made a claim for compensation as we felt we had been mis-sold the endowment. The claim was refused on the grounds that since the endowment was still 12 years from maturity, there was no absolute guarantee that it would not meet our expectations.

We are about to remortgage to repayment to cover ourselves for the future, but can we appeal on the claim for mis-selling?

dunstonh

You dont get a second bite of the complaint cherry unless you have new evidance or are in the 6 month period after the final response from Abbey. After that period you have timed out.

we have now received another warning letter saying that the expected maturity value of the endowment is only 15k - miles away from the sume of 55k required to pay the mortgage off!!! We are furious. This is devastating, not just a shortfall of a few thousand, but won't even make 1/3 of the value needed.

The difference is probably a change in projection rates. Remember projections are just examples and not guaranteed. You can get back more or less than the figures shown on the projections. By themselves, they are not a reliable guide to where your endowment may end up.

AndrewSmith

The problem is that there is a common misconception that poor performance of an endowment = the right to claim compensation for mis-sale.

Poor investment performance does not necessarily equate to the product having been mis-sold originally.

lulabelle81

Hi Andrew,
Thanks for your reply, I had a feeling that would be the answer. Its very frustrating! I guess the best thing to do is get ourselves onto a repayment mortgage quick-smart, and keep the endowment going for a rainy day.
At least we are lucky enough to be in a position where our mortgage is very affordable as it is less than 1.5 x our joint income!

dunstonh

and keep the endowment going for a rainy day.

If the endowment was any good it would hit target. Keeping it going for savings purposes could be throwing good money after bad.

However, projections (as I said above) are not reliable so you should review the policy first before making a decision to keep/sell/surrender.