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Endowment Mortgage Payments in Ireland
I have an endowment mortgage policy in Ireland since 1992. I have since paid off the actual mortgage on the house separately but I am still paying into the endowment policy at 80 euros per month. Its due to mature in 2017 but I cant really afford the 80 euros per month any more. The guaranteed cash in is around 22k at the end of the term. Anyone advise what my options are now, before I phone them and get sales talk. I would like to stop paying, but if I do that, do I have to cash it in now and take a lot less than the 2017 value? Can I reduce the payments significantly? Thanks for any advice.
to be honest, there are potentially too many variables here for anyone to answer without having more details. However, as a general rule for insurance linked endowment products, there are large penalties involved if you stop payments, and it will certainly significantly affect the guaranteed lump sum if you stop payment now. However, the worst thing you could do is cash it in now, as you will lose even more.
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My advice to you would be to speak with the insurance company and discuss your circumstances. However, you may also wish to consider taking independent advice from a specialist financial advisor. There are investment funds that buy endowment policies from people like you, and you could get significantly more than the insurance company is willing to offer you if you cash up now, or if you stop payments. I.e. they buy the policy from you and then make the payments themselves till the redemption date and therefore they get the guaranteed redemption value.
Search for "sell endowment policy" in google and you'll find a number of possibilities.
