Think You Were Missold Your Endowment Complain Now!!!! [CLOSED]

FOSman

So Edinvestor, you don't think an auditor would have understood the illustrations used?? Funny, I bet she understood the numbers on the red letters?!?!

Any other auditors out there? Let us know? Do you know what assumed annual rate of returns mean??

Let see who volunteers. Its a good thing people like you don't decide these cases.

nationwide_3

I was sold a endowment policy back in Jan 1982 which I was told would pay off my £45,000.00 mortage. I was one of the thousands who heard years later heard that some endowment policies would not pay out what was expected. If you were in this category you would receive a red, yellow etc letter. I never received a shortfall letter. So I thought I was ok. What I have now found out is that what I bought was an endowment policy for £22,000 and a life policy for £23,000 that was for a term of 20 years only. The reason I never received a red, yellow letter was that the endowment policy for £22,000 was expected to pay out £28,000, hence it was on track. But I now find myself with a shortfall of £17,000, when I was told the endowment policy would mature in excess of £45,000!!

Where do I stand?

dunstonh

Where do I stand?

Not in a good position really. However, that does depend on where you bought it and how? So, did you go to a bank or building society for advice or another source?

FOSman

You should have noticed from the paperwork. You don't really have a complaint that can really be upheld. Basically, you haven't lost any money, so just alter your mortgage and pay it off.

omen

Can i still claim if i cashed the endowment in and changed to repayment mortgage because i found out it was going to fall short?

whouston10

My mother and father took out an endowment in 1983 to run for 20 years. They were told that at the end of this period their mortgage would be paid and they would receive an 'extra' sum of over £3,000. They were lucky I suppose in that the policy did pay off their mortgage and they received £700 'extra'. (My father died in May this year but he was retired before the policy ended).

Is my mother able to make any sort of claim because they were missold this policy in that it did not provide anything like the 'extra' they were told?

Any advice greatly appreciated.

dunstonh

Is my mother able to make any sort of claim because they were missold this policy in that it did not provide anything like the 'extra' they were told?

Your parents would have got tax relief on the premiums and MIRAS on (most, if not all of) the mortgage balance which would have made the endowment mortgage cheaper than a repayment mortgage. They then ended up with a surplus.

On what grounds do you think they have to complain?

whouston10

dunstonh wrote:

On what grounds do you think they have to complain?

Only that they were led to believe that they would have a surplus of over £3,000. Of course that influenced their decision on whether to choose an endowment or repayment as they thought £3,000 would come in very useful in their retirement years.

Sorry I am not very well up in financial matters, I only know that it was a big disappointment to them not to receive anything like what was indicated at the time of taking out the policy.

dunstonh

Only that they were led to believe that they would have a surplus of over £3,000. Of course that influenced their decision on whether to choose an endowment or repayment as they thought £3,000 would come in very useful in their retirement years.

They got a surplus though. You cannot complain about rate of return.

As I mentioned in my previous post, they would have had a long period of MIRAS tax relief. The benefits of MIRAS effectively help made endowment mortgages cheaper than repayment mortgages. They also had Life assurance premium relief (LAPR) which would have reduced the endowment premium down. So, their monthly costs overall would have been lower than a repayment mortgage.

So, although they didnt get back as much as they thought they would, they were paying less each month than the alternative and still ended up with a surplus which they wouldnt have got on the repayment mortgage.

Investment returns have come down over the years, in part linked to a reduction in inflation. The real rates of return (after inflation) are little different to what they have always been.

Also, 20 years ago, a £3000 surplus would have been a lot of money. However, £3000 today doesnt go anywhere near as far.

dazzlin

Hear goes.. my first post, and I'll probably get flamed to death....

This whole mis-selling 'scandal' is a scam. It's a public relations exercise by the govt in response to people being unhappy with stock market falls.

Anyone with an endowment policy signed a piece of paper agreeing to a whole host of Ts & Cs and a load of fine print. Amongst the fine print and documentation would have been words along the lines of 'the policy is based upon stock market returns - these can go down as well as up'. Only if this is not the case were you mis-sold. And claiming that you don't remember them is not the same as them not actually being there. If you didn't bother to read it, or didn't understand it, or ignored it because you were going for the 'cheap' endowment rather than the 'expensive' repayment mortgage, or just plain thought it was a risk worth taking, then you weren't mis-sold, you've just been bitten on the backside by life.

And no, I've no connection to any financial services / insurance company whatsoever.