Mortgage endowments - Payment incorrect
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If your complaint has been upheld regarding your endowment, you should be paid compensation according to the position you would be in if you had taken out a repayment mortgage instead of a mortgage endowment. Compensation is not based on what you expected the endowment policy to be worth. Any compensation should account for the difference in any amount you would have paid off had you been repaying an equivalent repayment mortgage.You should know
- If it was not made clear to you that the endowment policy was an investment, you have the right to make a complaint.
- Whoever advised you regarding the policy should not have told you that the endowment was 'guaranteed' to pay off your mortgage. If they did so, you could make a complaint on the grounds that the policy was mis-sold to you.
- There is a time limit on appeals to the Financial Ombudsman. Your policy holder should have outlined this to you in warning letters when your endowment began to underperform.
- You should raise appeals with the firm whose advisor sold you the policy. They have eight weeks to investigate your complaint and send you a letter confirming whether or not they'll offer you compensation.
- If you aren't happy with the result, you can contact the Financial Ombudsman to take your case further.
Mis-sold mortgage endowments
If you weren’t clearly advised that you were taking out an investment to cover your mortgage, you may have been mis-sold your mortgage endowment. Advisors should have explained that the amount returned by the mortgage investment would depend on the performance of the policy. You have a right to expect advisors to be clear and honest when it comes to the product they’re offering you – if you believe they have not acted appropriately, you have the right to make a complaint.
Time-barring and complaints
When your endowment began to underperform, your policy holder should have sent you a letter warning you of the situation. This letter should have contained details of a clear final date for making a complaint. After this point, the firm will be able to object to your complaint as you have passed the final date for making a complaint.
You can make an appeal regarding this to the Financial Ombudsman, but your reasons for missing the final date will have to be exceptional in order to be successful.
Unfortunately, you cannot typically make a complaint that is only about your endowment underperforming. This is because an endowment is an investment, and investments are never guaranteed to give a good return. If your advisor told you that the endowment was guaranteed, however, you can make a claim on the grounds that they mis-sold the policy to you!
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