Q about endowment mortgages in the UK

[Stovies]

12 years ago when I last had a mortgage in the UK, Endowment policies were the way to go. However, if I remember correctly, last year things went pear shaped with those policies. Can anyone tell me if endowment policies are still risky, has something else taken their place or are they the best way to go to cover a UK mortgage?

 

Thanks.

[Guest Guest31881]

Not sure if endowment mortgages are still available, there was a lot of problems about 10 yrs ago with them not reaching full potential and people were being left with a shortfall when the policy was due to pay off the mortgage. I know some people were compensated because of the way the endowment s were sold and some had to take out second policy or convert to normal mortgage. Not heard of them being used for years.

[Guest The Ropey HOFF]

We had 5 seperate endowment mortgages, totalling £65,000 and about 8 years ago the endowment miss-selling scandal happened, where the policies were not meeting the full cost of the mortgage, in our case we were told it could fall short by has much as £35,000 which after paying through the nose for 25 years, to find out, we still owed over half of what we borrowed was going to be a nightmare. I wouldn't touch and endowment with a barge pole, luckily for us they accepted that we had been mis-sold it and we got compensation and went onto a repayment mortgage and we have paid it off, but at least you know where you are with a repayment mortgage.

[Phoenix16]

my advice is don't touch an endowment that's if they even still exist??

 

I bought my first house aged 21, put the offer in then was 'frogmarched' to an appointment withna Halifax Mortgage Advisor, I recall this advisor who was a Kajagoogoo lookalike telling me I would not only pay my mortgage off I'd make a big wedge besides! I was 21 and didn't have a clue, the monthly payments still gave me room to party, so I signed up. Since then a few things have worked in my favor, the house was 30k!! (was the 80's!), changed to a repayment a few years later, kept the endowment on as it was so cheap and when the scandal happened a few years ago I simply rang 'Standard Life' who basically called me back and told me I hadn't been asked loads of important questions and therefore the compensation cheque was in the post. Then I looked on the net and discovered that since my endowment had been taken out in the late 80s it was worth a packet and I basically sold it for a few K short of it's maturity value...felt like I'd won the lottery, all for 12 quid a month!!!

[Proview220]

Endowments are of the past now, you may find some one who can offer one, but at the end of the term it will leave a shortfall.

[derren7]

12 years ago when I last had a mortgage in the UK, Endowment policies were the way to go. However, if I remember correctly, last year things went pear shaped with those policies. Can anyone tell me if endowment policies are still risky, has something else taken their place or are they the best way to go to cover a UK mortgage?

 

Thanks.

I would stick to repayment, although, there is a quite a big market for traded or 2nd hand mortgages so I am sure some astute people out there are making money out of them, albeit, that they are used purely as investment vehicles and not linked to a mortgage.