Property News · January 29, 2014

What happens to the money from old endowment policies?


We have continued to pay the monthly premiums despite not needing the policies to pay off our mortgageQ My wife and I have four endowment polices which we took out with our first four mortgages back in the early 1980s. When it became apparent these were not going to meet their anticipated values, we switched to a repayment mortgage. Although they are no longer needed to pay off our mortgage, we have continued to pay the monthly premiums. They are now all due to come to an end over the next 18 months or so. As they are no longer linked to our mortgage, what happens to the money? TRA In the early days of endowment mortgages, the endowment policy was legally “assigned” to the mortgage lender. This meant that when the policy matured the proceeds would be paid directly to the bank or building society, which used the money to clear the mortgage loan and then paid any excess to the borrower. When you switched to your repayment mortgage, your old lender(s) should either have provided you with a discharged deed of assignment (also known as a notice of release) for each policy, or written to the insurance company formally to remove their claim on your policies. Continue reading…

Source : theguardian.com
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