Endowment Mortgage Compensation – Cashing In And Moving On

2007-03-08 10:33:40

( Financial )



Government regulators now estimate that eight in ten endowment mortgages are likely to fall short of settling the mortgages they were meant to pay. If you are a policy holder facing endowment mortgage shortfall you can take out additional mortagage insurance, if you can still afford the expense, or apply for endowment mortgage compensation.

Check with your insurance company to see if it is offering endowment mortgage compensation. You must contact your insurer immediately, so you can already plan a course of action for your probable endowment mortgage shortfall. Many insurance companies are sending out warning letters to their customers about the impending deficiencies in the issued endowment mortgages. You will have only three years within which to file a complaint and get suitable endowment mortgage compensation as your redress.

Remortgage

All the current controversies surrounding endowment mortgages make it difficult for you to make an informed decision on what to do when you get your endowment mortgage compensation proceeds. You will probably want to transfer the risks in your endowment mortgage shortfall to a lower-risk product like ordinary mortagage insurance.

Interest rates have averaged lower in recent years, and mortagage rates on mortagage loans have also gone down. As a result, mortagage insurance premiums have become more affordable. You may want to take this remortgage route, more than seventy percent of policy owners like you have done so.

Selling in the secondary market

You may also consider cashing in your endowment policy through the traded endowment policies market. This secondary market has attracted investor demand in the last few months. It is now possible to get at least fifteen percent more than the cash-surrender value of endowment mortgages by selling your policy in this market rather than surrendering it to your insurer.

You should see your financial advisor, because there are emerging options that may give you more value than simply disposing of your endowment policy now.


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