mortages, been paying for 30 years even though it is contracted for 25 years?

Question

hi,

ive got a mortage back in 1976 which was for lets say £9,000. it was for a 25 year period. to this day im still paying it and still got about another £5,000 left to pay, never missed a month payment. its been for 30 years now what should i do?

also back in 1976 when i got this mortage i got told by my bank that i'll be getting a lump sum after the 25 year period to a value of something like £20,000. any body know what i can do or any advice?
thanks

Answer 1

I would hazard a guess that you've got an endowment mortage of some sort, of the type that was popular in the 70's and 80's, and which failed to live up to expectations by maturity, leaving millions short of their expected maturity bonus. Essentially, your payments would have been split: some would go to the lender to cover the interest on the capital you borrowed, while the rest would be invested into an endowment policy in the hope that the total investment would exceed the borrowed capital at maturity, ie the end of the 25 year term.

For most people, this didn't work in practise, and left people with an outstanding debt. However, there are compensation plans available: the BBC link below explains the circumstances, and at the right of the page, you' can find the links to the Financial Services Authority, the government watchdog.

If its not an endowment mortgage, then I'm afraid I don't know!!!

Answer 2

Talk to the lender. Ask for an explanation. If they said you should get a lump sum after 25 years then it was probably an endowment mortgage and you should have been paying an insurance premium as well as the mortgage payments. If you let the insurance lapse it may explain why you are still paying. The mortgage payments on an endowment mortgage only cover the interest on the amount borrowed and you will never pay the debt off..
If you get no sense from your lender go to the Citizens Advice Bureau for help.

Answer 3

Sounds like you set up an endowment to repay it. These have greatly reduced over the years as the stock market did not perform to original predictions.

unfortunately there is nothing you can do unless you can prove you were mis-sold the original policy - highly unlikely after such a long time.

If you want to stop paying anyithg why not get an equity release mortgage. No for me but some people find them useful, it jsut menas you'll have less to leave in an estate.

Answer 4

It sounds as though you have an interest only mortgage with an endowment.

You need to ask your lender for a mortgage statement.

Armed with this you need to go to your lender taking any documents you had been given at the start of the contract, back in 1976. If you dont have these your lender can give you copies of what they have on file.

THEY SHOULD BE ABLE TO EXPLAIN HOW THE LOAN WAS SET UP AND HOW IT IS TO BE REPAID>

IF YOU DONT LIKE THE ANSWER OR DONT UNDERSTAND IT ASK THEM TO CONFIRM TO YOU IN WRITING AND TAKE IT ALL TO A FINANCIAL¬ADVISER WHO CAN EXPLAIN YOUR OPTIONS>

Answer 5

something humorous THERE!. except you have saved paying a similar volume quite some those years even while the activity fee went . I had a 25 300 and sixty 5 days own loan and paid it up in 18years simply by fact while the activity fee went down I saved on paying a similar, and if it went up I paid the hot fee.

Answer 6

sounds like you have an endownment mortgage ,you need to speak to your mortgage provider .
if you have you may be able to claim back money for mis selling of your endownment policy .
more than likely the endownment is in what they call shortfall ,in other words it will now not cover the cost of the house and not provide a surplus .
you should try reading up on the internet ,if i can help let me know by email .btw im not in the finance industry but have claimed for a shortfall in an endownment policy

Answer 7

id go straight to the bank!!its taken you 5 years to realise youre still paying a mortgage you should have paid off? the lump sum bit sounds like you had an endowment which is used to pay off youre mortgage at the end of its term "sometimes "with a bit left over.something not right go to bank now.

Answer 8

Hi,
Go on the site at www.loancheck.org.uk and complete the LoanChecker on the home page. It sounds as though there is an issue with your mortgage and we may well be able to help.
best of luck
peter

Answer 9

You'd better get someone to look at this for you. Something has clearly gone wrong and it's up to the bank to explain what. If you hit a brick wall, email me.

Answer 10

Sounds like you havbe a mortgage with an endowment policy. The policy will have a date of maturity - check your policy and contact the the insurance compan.