Endowment

[Richard C]

Well I've got to admit obscurity is starting to loose me a little now, I think I could take that as a term of endearment or an insult -- I think ;

my long term memory is not that good either so perhaps senility is setting in after all

 

[RigidRaider]

I think what irritates most people was that at that time we were told that an endowment mortgage was the modern way to go.

It's easy to look back and gasp at our stupidity but most of us were considerably greener then that we are now so we fell for the ruse.

 

[LooPrEvil]

There was a really simple question people should have asked when taking out mortgage endowment policies........Is my mortgage gauranteed being cleared at the end?

Hind sight is a wonderful thing. These policies were sold by professional financial advisors, who the public trusted in those days. General members of the public are not buying houses everyday of the week so the guidance was trusted. It was only some decades later that the FSA realised best advice was NOT always given and no emphasis was being placed on the risk, because basically the advisors would show illustrations that indicated no loses has been incurred over the past decades or even longer.

We now know different, but of course the lower maturity values are mainly caused by the global collapse of financial markets. And we all know who caused that - the BANKERS and FIANCIAL INSTITUTIONS. What chance then for the average man in the street - NONE!

Lou.

 

[D_Hailsham]

The real problem is that mortgage lenders take into account the anticipated bonuses on an endowment policy.

When I first took out a mortgage, in 1976, building societies would only take into account the face value of an endowment policy; the potential interest and bonuses earned over the life of the policy were ignored. So I had to put down a £2000 deposit and have two £5k endowment policies to buy my first flat.

Over the years the two policies earned interest, so their face value grew. When I got married and moved from my flat to a house, the increased face value of the policies were enough to cover the increased mortgage, so I did not have to take out a further policy. I moved three times in total over the 25 year life of the policies and each time they had increased in value sufficient to cover the increased mortgage.

When they eventually matured, one £5k policy was worth about £20K and the other over £30K.

 

[namsag]

Most expensive thing you will buy in your lifetime and in a lot of cases take a lifetime to pay,
So first question anyone should have asked is after 25 years and me paying all that money will it be mine yes or no hindsight is a good thing but common sense is an even better one.

Now can i interest you in pyramid selling you will make a fortune out of that.

 

[empip]

As far as I recall a standard endowment mortgage guaranteed to repay the loan, but made no promises regarding any bonus, the providers were allowed to use a certain maximum percentage in their 'what if' scenario spins.
The much touted 'Low Cost' endowment mortgage assumed a certain minimum growth in value over it's term, thus providing possible repayment of loan and maybe a bonus, all from lower charges !! More dosh required if the plan was falling behind. - Not a good buy, but if this was the only mortgage one could afford... in the 80's or so, then no doubt the explosion in property prices helped a little - in the shorter term.

Also, way back one received tax relief on the total interest paid per annum at one's highest tax rate, a nice little earner that, an endowment charges interest on the full capital amount borrowed throughout the term - so the tax relief was more or less a constant. Until successive Govn's moved the goal posts.

-0-

 

[Nige F]

I think what irritates most people was that at that time we were told that an endowment mortgage was the modern way to go.

It's easy to look back and gasp at our stupidity but most of us were considerably greener then that we are now so we fell for the ruse.

Not me not as green as I`m cabbage looking . I said to the salesman - your £ predictions wont be worth a carrot in 25 years what with inflation etc. - got shot of the endowment as soon as it was financially prudent to change to repayment . I `d had a decade of single living ****ing £oads against the wall and enjoying myself so I wasn`t going to carry that on as a young married bloke

 

[hi1]

Basically we are just here to keep nice people in superior life styles.

We've been screwed on endowments, my mother never got her war tax credits back either, we will be screwed when the pension is turned in to an annuity, you will be screwed if you try to transfer the pension to get a better deal.

We've been screwed with the property illusion. We've been screwed by the bankers to protect their bonuses. And when you die your nearest and dearest will be screwed out of the little bit you did manage to keep, having paid those care costs.

So when you go to bed tonight you can have a warm inner glow thinking of all those deserving people you have helped with your money.

 

[Nige F]

How can a "property owning democracy" be an illusion guess who said that Who let the Barrer Boys loose in the city

 

[LooPrEvil]

The financial institutions will always get away with 'screwing' us.

Lou.