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Traded Endowment Policy help needed!!!
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leadupthegardenpath
Posts: 1 Newbie
Many years ago we were encouraged to buy some Traded Endowment Policies (TEP's) by a IFA. We were advised to put our life savings into them and to take out a loan to buy a higher value of TEP's. The idea was for the value of the policies to pay off the loan at maturity and leave us a healthy profit. We have now received letters from the people the loan is with (a Building Society) saying that the policy isn't going to be enough to pay off the loan and that they intend to sell the policies to reduce their losses. It is very upsetting to have apparently lost our life savings but doubly aggravating to apparently still owe a lot of money to the building society. We were not told that we could end up in this situation in fact we were told that the capital invested would at least be safe even if it didnt grow. We now appear to have lost the lot and be in considearble debt. Is anyone else in this situation. Does anyone have any helpful suggestions or know who if anyone we could take this up with??
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Is anyone else in this situation.
In terms of endowment policies failing to produce enough to pay off a loan or mortgage, you are in the same position as a lot of people who took out endowment mortgages. The fact that you bought endowments off other people rather than taking them out from scratch isn't that material.I'm a Forum Ambassador on the housing, mortgages & student money saving boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Forum Ambassadors are not moderators and don't read every post. If you spot an illegal or inappropriate post then please report it to forumteam@moneysavingexpert.com (it's not part of my role to deal with this). Any views are mine and not the official line of MoneySavingExpert.com.0 -
We were advised to put our life savings into them and to take out a loan to buy a higher value of TEP's.
Flipping heck.Does anyone have any helpful suggestions or know who if anyone we could take this up with??
The transaction you have done is seriously high risk. That level of gearing is really only suited to experience investors. Now, if that is you and the risk was known then its tough luck if it goes wrong. If it isnt you then you do have consumer protection.
You should make a complaint to the IFA that recommended this transaction. They have 8 weeks to issue a formal response. At that point if you dont like the response you have the opportunity to go to the FOS. Not before then though.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0 -
Step one is to make a formal complaint to whoever gave you the advice to invest in the TEPs. This would be on the basis the investment was unsuited to your attitude to risk - presumably you are cautious investors.
If the advisor rejects the complaint, you can take it on to the FOS, you must do this within 6 months of the rejection.
https://www.financial-ombudsman.org.ukTrying to keep it simple...
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