Mis-sold Pension Mortgages: What You Need To Know
Pension Mortgage Definition
Designed to include a personal pension as an additional investment plan, a pension mortgage is in nature an interest only mortgage. They were said to be an easy means of paying mortgages and were mainly sold between the 1980s and 1990s.
There were anything but, as it turned out. Baited with the possibility of more affordable, interest only payments, consumers were switch to a Pension Mortgage from their existing repayment mortgage. However, as many consumers would later find out at their own expense, combining pension planning and home ownership into a single financial product was in itself going to be risky.
The fund would need to grow 4x the mortgage value, because only a quarter of it could be used to cover repayment of the mortgage. As it stands, the value of many pension policies is only a fraction of what customers were told to expect, as a result of low investment returns dating back to the eighties. Many consumers were left hanging high and dry, at the worst time, with less cash available to cover mortgages, and even less for retirement.
This is not about a simple loss in anticipated growth, as is the case with Endowment Mortgages. It is simply about bad information. You may have been mis-sold, if the sales who sold you the product did not inform you about it adequately, or failed to consider your individual circumstances. Read the statements below, if you are still not sure. You might satisfy the requirements to file a complaint if any apply to you.
1. You Received Insufficient Information About The Level Of Risk Involved
You should have been informed that the risk of shortfall in the case of pension mortgages comes at a time when you are most vulnerable, financially.
2. You Never Discussed Your Attitude Towards Risk
Your risk attitude was not properly addressed by the advisor, including whether inability to pay your mortgage off was an acceptable risk to you. The advisor should have taken the time to thoroughly investigate this before making any recommendations simply because of how important it is.
3. Alternative Investment Products Were Not Discussed
Other investment alternatives that are less risky were not discussed by your advisor, ad you never got the opportunity to compare them with Pension Mortgages.
4. In case of poor performance of the investment, you were not informed about what would happen.
How To Make A Claim For Pension Mortgage Compensation
You have to main options. You can make a claim with the help of an expert, or on your own. It’s important for us to say that we cannot guarantee that you will get faster service, more money or even a payout, if instead of going it alone, you choose us to represent you. More importantly, anyone who makes such a claim is not worth your time.