Commercial Endowment : Your Options

Property development is big business. The rash of TV programmes about home makeovers and renovations reflects our current obsession with property as a way to make big bucks, quickly. It may seem a failsafe way to make a killing - buy a shabby house, paint the place magnolia, add laminate flooring, and bingo!

In reality, of course, property development means a lot of hard work, and involves a certain degree of risk. Many developers will have more than one property on the go at once - and to cover repayments can end up being an expensive business. If you factor in the time it takes to renovate a property, then advertise and sell it, it adds up to several months when you will have to be paying out on a mortgage. Not only that, but the fact that rates for commercial property are generally higher than for residential mortgages, and it can be a costly period indeed. Other reasons you may require a commercial mortgage is if you are buying business premises or buy to let property. For all of these needs, you will want to keep your monthly outgoings as low as possible.

One solution is taking out an interest only mortgage, such as an endowment mortgage. This will minimise your monthly repayments, and the extra security provided by the endowment policy could result in the lender offering a better interest rate for your mortgage. You will be paying interest instalments, plus separate amounts into an endowment policy. The payment of the capital, or principal will come from the proceeds of the endowment policy. (Bear in mind that the tax benefits have changed since endowments had their heyday in the 80s and 90s.)

Endowments - The Bad Press

In recent years there have been scandalous reports about endowment policies being mis-sold - thousands of people lost out when their policies failed to produce the lump sum needed to pay off the capital. The FSA, after investigating, reported that the problem had been exaggerated - most people with endowment policies are as well off as those with other types of mortgage. However, endowments are investments linked to the stock market, and as such do represent a financial risk. Insurance companies were forced to pay compensation to some investors who had received bad advice when they took out an endowment policy.

If you end up with an endowment policy that has not produced the money to pay off your capital, you may be entitled to compensation if the advice you received was not sufficient to make you aware of the risk involved. You can also consider selling your endowment in the traded endowments market, which could make you more than surrendering it to the insurance company.

Endowment Mortgages : Some Great Advice Everybody Should Read

Now, an endowment mortgage is a loan that you can get on what is called the "interest-only" basis. This is when the borrower is planning to pay with one or more endowment policies. An endowment mortgage is mostly used in the United Kingdom by consumers and also the lender. They don't tend to think of this arrangement on a legal scale.

So, think about this, the borrower will have two agreements at his disposal that are separate from one another. The borrower is able to change the terms in either one of the agreement if he wants to. A long time back, the idea of such a policy (endowment) was thought of that extra push of security for the lender.

Back then, the lender would make sure that it was made legal to ensure that any money incurred from the endowment was to go to him instead of the borrower. Though sneaky and underhanded, this has not been done in this way for a very long time.

There are reasons why a person would choose an endowment mortgage and that is because the customer will only pay the interest on money (or capital) that was borrowed, this in turn would basically save money because it is different than the regular repayment loan.

With the repayment loan, the borrower will then have to make his payments to something called an endowment policy. The goal of this was so that the investment that was made through the endowment policy would be enough to cover the mortgage when the time came and then of course there would be the possibility of a little extra cash to play with.

Now remember, as with anything there are a few downfalls to getting or even being involved with an endowment mortgage. We will be discussing a few of these problems in the next few paragraph. Not they say one of the bad things about using an endowment policy to pay back a mortgage is that you really won't make ends meet in the long run.

Truth be told, back in the 1800's there was a big boom in selling endowment mortgages, it was going crazy, the buyers were told that they would see a high rate for the return of said policies (approximately 12% per year). Well, lo and behold by the 1990's the economy kind of fell out from under civilization and basically grounded all of these dreams into dust.

Commercial Endowment : Your Options

Property development is big business. The rash of TV programmes about home makeovers and renovations reflects our current obsession with property as a way to make big bucks, quickly. It may seem a failsafe way to make a killing - buy a shabby house, paint the place magnolia, add laminate flooring, and bingo!

In reality, of course, property development means a lot of hard work, and involves a certain degree of risk. Many developers will have more than one property on the go at once - and to cover repayments can end up being an expensive business. If you factor in the time it takes to renovate a property, then advertise and sell it, it adds up to several months when you will have to be paying out on a mortgage. Not only that, but the fact that rates for commercial property are generally higher than for residential mortgages, and it can be a costly period indeed. Other reasons you may require a commercial mortgage is if you are buying business premises or buy to let property. For all of these needs, you will want to keep your monthly outgoings as low as possible.

One solution is taking out an interest only mortgage, such as an endowment mortgage. This will minimise your monthly repayments, and the extra security provided by the endowment policy could result in the lender offering a better interest rate for your mortgage. You will be paying interest instalments, plus separate amounts into an endowment policy. The payment of the capital, or principal will come from the proceeds of the endowment policy. (Bear in mind that the tax benefits have changed since endowments had their heyday in the 80s and 90s.)

Endowments - The Bad Press

In recent years there have been scandalous reports about endowment policies being mis-sold - thousands of people lost out when their policies failed to produce the lump sum needed to pay off the capital. The FSA, after investigating, reported that the problem had been exaggerated - most people with endowment policies are as well off as those with other types of mortgage. However, endowments are investments linked to the stock market, and as such do represent a financial risk. Insurance companies were forced to pay compensation to some investors who had received bad advice when they took out an endowment policy.

If you end up with an endowment policy that has not produced the money to pay off your capital, you may be entitled to compensation if the advice you received was not sufficient to make you aware of the risk involved. You can also consider selling your endowment in the traded endowments market, which could make you more than surrendering it to the insurance company.

Endowment Mortgages : Some Great Advice Everybody Should Read

Now, an endowment mortgage is a loan that you can get on what is called the "interest-only" basis. This is when the borrower is planning to pay with one or more endowment policies. An endowment mortgage is mostly used in the United Kingdom by consumers and also the lender. They don't tend to think of this arrangement on a legal scale.

So, think about this, the borrower will have two agreements at his disposal that are separate from one another. The borrower is able to change the terms in either one of the agreement if he wants to. A long time back, the idea of such a policy (endowment) was thought of that extra push of security for the lender.

Back then, the lender would make sure that it was made legal to ensure that any money incurred from the endowment was to go to him instead of the borrower. Though sneaky and underhanded, this has not been done in this way for a very long time.

There are reasons why a person would choose an endowment mortgage and that is because the customer will only pay the interest on money (or capital) that was borrowed, this in turn would basically save money because it is different than the regular repayment loan.

With the repayment loan, the borrower will then have to make his payments to something called an endowment policy. The goal of this was so that the investment that was made through the endowment policy would be enough to cover the mortgage when the time came and then of course there would be the possibility of a little extra cash to play with.

Now remember, as with anything there are a few downfalls to getting or even being involved with an endowment mortgage. We will be discussing a few of these problems in the next few paragraph. Not they say one of the bad things about using an endowment policy to pay back a mortgage is that you really won't make ends meet in the long run.

Truth be told, back in the 1800's there was a big boom in selling endowment mortgages, it was going crazy, the buyers were told that they would see a high rate for the return of said policies (approximately 12% per year). Well, lo and behold by the 1990's the economy kind of fell out from under civilization and basically grounded all of these dreams into dust.

With Profit Endowment Policy Holders, See Reduced Annual Bonuses

Recently, many of the UK's leading insurance companies announced reduced annual bonuses for With Profit Endowment policy holders, yet another blow for homeowners who took out endowments during the 1980s and 1990s, as they will now see increased shortfalls on their mortgage liabilities.

Some of the big names that have declared reduced annual bonuses are Scottish Widows, Friends Provident, Norwich Union and Scottish Life, while some have bucked the trend, and increased payouts - these include Standard Life, Prudential and Legal and General. But unfortunately for many endowment policy holders, payouts are down.

Annual bonus declarations vary from insurance company to insurance company because they are influenced by a number of factors, which include past investment performance, previous bonus announcements and the financial strength of the company.

For example, those who have policies with Scottish Widows, Friends Provident, Norwich Union and Scottish Life will see reduced annual bonuses in 2008 compared with the previous year. Based on a male policy holder with a 25 year endowment policy who was aged 30 when he took out the policy paying £50 per month, a Scottish Widows endowment would see a reduction of £442 between 2007 and 2008.

A Friends Provident policy would see a payout of £37,540 in 2007 reduced to £36,425 in 2008, Norwich Union's payout would decrease by £2,776 and a Scottish Life policy would decrease by more than 8 per cent - from £37,132 in 2007 to £34,196 in 2008.

Where a policyholders' endowment continues to under-perform, the insurance company should write to them, warning them of the potential shortfall. However, there are things that can be done to address this potential shortfall before it is too late.

Make a complaint - Many endowment policy holders have successfully won complaints cases against insurance companies because they say the potential risks of endowment were not explained properly to them when they took the policy out. The FSA has more information about endowment complaints.

Surrender - Because of the bad press that endowments have received over the last 10 years or so, many policyholders are trying to get rid of them, and will often just settle for the surrender value offered to them in the hope of cutting their losses and getting back cash.

Sell - There is now a fairly healthy secondhand market for endowments and those who have sold their endowment policy on to an investor have found that they got a lot more than they would have if they had settled for the surrender value - up to 45% in some cases. The reason is, potential investors see endowments as an attractive investment, due to relatively low risk investment strategy and partially guaranteed return.

But the best advice is to get advice; if you are uncertain about what to do, seek independent advice from a specialist.

Isla Campbell is an online, freelance journalist and avid traveler and pilates devotee. When not on the road she lives on the outskirts of Oban.

Endowment Policy Buying Guide

Endowment policy is a combination of life insurance and investment growth saving plans. It is a premium based package that is valid for a specified period. The premium paid by the policy holder into the endowment is invested by policy office in the stock market. On the maturity of the endowment policy the policy holder is paid the agreed amount along with bonuses. Incase the policy holder dies in mid-term then the insurance amount is paid to his beneficiary. Endowment policies are also used for repaying the mortgages but incase of endowment mortgage the monthly premium will also include the interest on the loan.

Evaluate your needs: There are various types of endowment policies namely non-profit Endowment Policy, Traditional With Profits Endowment, Low Cost Endowment Policy, Unit Linked Endowment Policy, and Traded Endowment Policy. Each has its own pros and cons as their workings and methods of growth are different from each other. It is advisable that the policy holder should evaluate his financial needs and consults a professional before buying an Endowment Policy. Educate yourself to understand the features of each type of insurance policy and then select the policy that benefits YOU personally and suits YOUR needs.

Check the reputation of the insurance company: Make sure you select the top endowment company for buying an endowment policy. The reputation and previous records should be checked thoroughly before making the final decision to buy an endowment. Find out the company's market standing. Don't trust your agent blindly and verify the facts yourself. Go for company with credible ratings given by a credible agency.

Evaluate the Front-End Loading: The set up cost, administration charges and commission payments are usually higher in the early years and are hidden within the monthly premiums. These initial costs are known as front end loading. Therefore, before you choose an endowment find out the charges and past performance of the fund.

Check the Endowment Mortgage Fee: Incase of endowment mortgage, calculate the mortgage fees carefully and try to evaluate the mortgage package before buying an endowment policy. At times, the lender charges additional front loan or processing fee, so carefully plan the investment to avoid defaulting.

Endowment Selling and Surrendering Options: A good alternative to surrendering is endowment policy selling. In this, the policy holder can sell the policy in TEP market and fetch a fair value of the policy. The main advantage here is that the policy holder usually gets much more than the surrender value offered by the insurance company.

More Endowment Policy Buying Tips

* Take help from a financial consultancy as it is a long-term investment.
* Check the amount of premium payments and your affordability.
* Carefully read and review the insurance agreement before signing for it.
* Invest only if you intend long-term investment as surrendering it in early years can prove costly.
* Do thorough study and clear out all your doubts with insurance company and the financial advisor before you strike the deal.
* Check the flexibly plan and alternate options for protection against uncertain changes in your financial needs.
* Select a reliable insurance company and choose a right policy to gain maximum benefits and tax relief.

For selling or surrendering your endowment policy, contact www.endowment-policy.co.uk. You can also seek expert advice for valuation and get free compensation assessment of your endowment policy.

Robert Prime is a professional author who has written many articles on various topics & this time writing article on Endowment Policy Buying Guide.

With Profit Endowment Policy Holders, See Reduced Annual Bonuses

Recently, many of the UK's leading insurance companies announced reduced annual bonuses for With Profit Endowment policy holders, yet another blow for homeowners who took out endowments during the 1980s and 1990s, as they will now see increased shortfalls on their mortgage liabilities.

Some of the big names that have declared reduced annual bonuses are Scottish Widows, Friends Provident, Norwich Union and Scottish Life, while some have bucked the trend, and increased payouts - these include Standard Life, Prudential and Legal and General. But unfortunately for many endowment policy holders, payouts are down.

Annual bonus declarations vary from insurance company to insurance company because they are influenced by a number of factors, which include past investment performance, previous bonus announcements and the financial strength of the company.

For example, those who have policies with Scottish Widows, Friends Provident, Norwich Union and Scottish Life will see reduced annual bonuses in 2008 compared with the previous year. Based on a male policy holder with a 25 year endowment policy who was aged 30 when he took out the policy paying £50 per month, a Scottish Widows endowment would see a reduction of £442 between 2007 and 2008.

A Friends Provident policy would see a payout of £37,540 in 2007 reduced to £36,425 in 2008, Norwich Union's payout would decrease by £2,776 and a Scottish Life policy would decrease by more than 8 per cent - from £37,132 in 2007 to £34,196 in 2008.

Where a policyholders' endowment continues to under-perform, the insurance company should write to them, warning them of the potential shortfall. However, there are things that can be done to address this potential shortfall before it is too late.

Make a complaint - Many endowment policy holders have successfully won complaints cases against insurance companies because they say the potential risks of endowment were not explained properly to them when they took the policy out. The FSA has more information about endowment complaints.

Surrender - Because of the bad press that endowments have received over the last 10 years or so, many policyholders are trying to get rid of them, and will often just settle for the surrender value offered to them in the hope of cutting their losses and getting back cash.

Sell - There is now a fairly healthy secondhand market for endowments and those who have sold their endowment policy on to an investor have found that they got a lot more than they would have if they had settled for the surrender value - up to 45% in some cases. The reason is, potential investors see endowments as an attractive investment, due to relatively low risk investment strategy and partially guaranteed return.

But the best advice is to get advice; if you are uncertain about what to do, seek independent advice from a specialist.

Isla Campbell is an online, freelance journalist and avid traveler and pilates devotee. When not on the road she lives on the outskirts of Oban.

Endowment Policy Buying Guide

Endowment policy is a combination of life insurance and investment growth saving plans. It is a premium based package that is valid for a specified period. The premium paid by the policy holder into the endowment is invested by policy office in the stock market. On the maturity of the endowment policy the policy holder is paid the agreed amount along with bonuses. Incase the policy holder dies in mid-term then the insurance amount is paid to his beneficiary. Endowment policies are also used for repaying the mortgages but incase of endowment mortgage the monthly premium will also include the interest on the loan.

Evaluate your needs: There are various types of endowment policies namely non-profit Endowment Policy, Traditional With Profits Endowment, Low Cost Endowment Policy, Unit Linked Endowment Policy, and Traded Endowment Policy. Each has its own pros and cons as their workings and methods of growth are different from each other. It is advisable that the policy holder should evaluate his financial needs and consults a professional before buying an Endowment Policy. Educate yourself to understand the features of each type of insurance policy and then select the policy that benefits YOU personally and suits YOUR needs.

Check the reputation of the insurance company: Make sure you select the top endowment company for buying an endowment policy. The reputation and previous records should be checked thoroughly before making the final decision to buy an endowment. Find out the company's market standing. Don't trust your agent blindly and verify the facts yourself. Go for company with credible ratings given by a credible agency.

Evaluate the Front-End Loading: The set up cost, administration charges and commission payments are usually higher in the early years and are hidden within the monthly premiums. These initial costs are known as front end loading. Therefore, before you choose an endowment find out the charges and past performance of the fund.

Check the Endowment Mortgage Fee: Incase of endowment mortgage, calculate the mortgage fees carefully and try to evaluate the mortgage package before buying an endowment policy. At times, the lender charges additional front loan or processing fee, so carefully plan the investment to avoid defaulting.

Endowment Selling and Surrendering Options: A good alternative to surrendering is endowment policy selling. In this, the policy holder can sell the policy in TEP market and fetch a fair value of the policy. The main advantage here is that the policy holder usually gets much more than the surrender value offered by the insurance company.

More Endowment Policy Buying Tips

* Take help from a financial consultancy as it is a long-term investment.
* Check the amount of premium payments and your affordability.
* Carefully read and review the insurance agreement before signing for it.
* Invest only if you intend long-term investment as surrendering it in early years can prove costly.
* Do thorough study and clear out all your doubts with insurance company and the financial advisor before you strike the deal.
* Check the flexibly plan and alternate options for protection against uncertain changes in your financial needs.
* Select a reliable insurance company and choose a right policy to gain maximum benefits and tax relief.

For selling or surrendering your endowment policy, contact www.endowment-policy.co.uk. You can also seek expert advice for valuation and get free compensation assessment of your endowment policy.

Robert Prime is a professional author who has written many articles on various topics & this time writing article on Endowment Policy Buying Guide.

7 Major Reasons Why Traded Endowment Policies Benefits You

You have not worked so hard every day only to see your wealth accumulated through the years go down the drain.

Whatever your financial needs and future plans may be, here are 7 major reasons why Traded Endowment Policies can be used to your benefits.

Low Market Risk

The Traded Endowment Policy (TEP) market in the UK is a highly regulated industry. It has been around for more than 100 years and the governing body has well placed infrastructure to protect the interests of investors.

High Capital Guarantee

Every Traded Endowment Policy (TEP) that you invest in has a "Capital Guarantee" value in the form of the sum assured plus the attaching bonuses. These values once allocated cannot be reduced and removed. You can choose percentage of Capital Guarantee from 70% to 100%

No Yearly Management and Service Fees

Unlike mutual funds, as a TEP owner, you are not charged a yearly management or service fees that will in turn marginalize your returns. Thus maximizing your potential gains from the profits paid out.

Tax Benefits

If you are a non-UK resident ie Singaporean, your returns from TEP are not taxed. (However, please check with your respective tax agents with regards to your unique situation.)

Flexibility

At your own discretion, you may have a choice of maturity dates ranging from 3 years to as long as 10 years. The maturity dates are fixed so there is certainty in your financial planning. The best part is since there is an existing market for TEPs, you as an owner can choose to sell it anytime you wish to.

Zero Cost to the Investor

A unique feature of TEP is that the cost of transaction is to be borne by the seller. This means that as an investor, what you pay is what you get!

Competitive Returns

Majority of the TEPs have been in forced for many years and are close to their maturity dates. Bulk of the bonuses is only paid out at the final year. By taking over a TEP instead of starting an endowment policy from scratch, you are maximizing your returns per year.

Kevin Yeo is an expert in the business of helping individuals grow and preserve their wealth.

He is currently in the project of educating investors of the merits of Traded Endownment Policies.

7 Major Reasons Why Traded Endowment Policies Benefits You

You have not worked so hard every day only to see your wealth accumulated through the years go down the drain.

Whatever your financial needs and future plans may be, here are 7 major reasons why Traded Endowment Policies can be used to your benefits.

Low Market Risk

The Traded Endowment Policy (TEP) market in the UK is a highly regulated industry. It has been around for more than 100 years and the governing body has well placed infrastructure to protect the interests of investors.

High Capital Guarantee

Every Traded Endowment Policy (TEP) that you invest in has a "Capital Guarantee" value in the form of the sum assured plus the attaching bonuses. These values once allocated cannot be reduced and removed. You can choose percentage of Capital Guarantee from 70% to 100%

No Yearly Management and Service Fees

Unlike mutual funds, as a TEP owner, you are not charged a yearly management or service fees that will in turn marginalize your returns. Thus maximizing your potential gains from the profits paid out.

Tax Benefits

If you are a non-UK resident ie Singaporean, your returns from TEP are not taxed. (However, please check with your respective tax agents with regards to your unique situation.)

Flexibility

At your own discretion, you may have a choice of maturity dates ranging from 3 years to as long as 10 years. The maturity dates are fixed so there is certainty in your financial planning. The best part is since there is an existing market for TEPs, you as an owner can choose to sell it anytime you wish to.

Zero Cost to the Investor

A unique feature of TEP is that the cost of transaction is to be borne by the seller. This means that as an investor, what you pay is what you get!

Competitive Returns

Majority of the TEPs have been in forced for many years and are close to their maturity dates. Bulk of the bonuses is only paid out at the final year. By taking over a TEP instead of starting an endowment policy from scratch, you are maximizing your returns per year.

Kevin Yeo is an expert in the business of helping individuals grow and preserve their wealth.

He is currently in the project of educating investors of the merits of Traded Endownment Policies.

Endowments and Endowment Shortfalls : What You Need To Know

Endowments and endowment mortgages have received a lot of bad press in recent years, amid concerns over falling policy values and accusations of endowment miss-selling.

This article attempts to answer some of the questions and concerns you may have about the way endowments work, what's happening to them, and what you can do to ensure your mortgage is paid off at the end of the term if you have an endowment
mortgage.

What is an endowment mortgage?

There are two basic types of mortgage. The first is a repayment mortgage, where you make one monthly payment to the lender which is part interest and part repayment of the original capital.

Then there are interest-only mortgages, where your monthly payment to the lender is just the interest on the original loan and the mortgage debt remains unchanged. You then make separate payments into an investment scheme (such as an endowment), with
the idea being that at the end of the mortgage term this investment will have grown sufficiently to repay the mortgage.

An online mortgage calculator can give you an idea of the difference in payments to your lender between an interest-only mortgage and a repayment mortgage.

Interest-only endowment mortgages were very popular in the 1980s and 1990s and were often chosen in the belief that the endowment would end up being large enough to clear the mortgage and still leave a tidy sum of money left over as a bonus.

How do endowments work?

An endowment is a long-term savings policy, typically running for ten to twenty-five years. An endowment plan has what is known as a "sum assured" value. If the policyholder dies during the life of the endowment, it pays out the sum assured. In the case of endowments linked to mortgages, the sum assured is equal to the size of the mortgage. The payout in the event of the death of the policyholder is guaranteed but, if the policyholder survives, the final value of the endowment at the end of its term is not guaranteed.

Endowments can be unit linked, which means that you buy units in a fund, or they can be "with profits".

How does money grow in a with profits endowment?

There are two ways in which a with profits endowment can increase in value. Firstly, the insurance company may add a bonus to your policy each year. This is known as a reversionary bonus and is usually a percentage of the amount of profit made by the fund over the previous years.

The amount added in this way may only be a small amount. However, once added, these bonuses cannot be taken away - hence the name reversionary bonus - and will belong to you when the policy matures.

Then there is the terminal bonus. This is a separate sum of money which the insurance company can add to your endowment policy when it matures. These terminal bonuses are discretionary and may not be applied at all.

What are the advantages of with profits endowments?

The idea of a with profits endowment is to smooth out fluctuations in the stockmarket.

With a non-with profits endowment, your investment is linked 100% to the stockmarket. Therefore, there is always the possibility that the investment value could fall just at the time when you need the money.

By using with profits endowments, insurance companies get round this problem by giving you a slightly smaller percentage of any fund growth as an annual bonus and try to smooth out future annual bonus declarations.

The point of this is to try to ensure that, no matter what happens to the returns of the fund, you are guaranteed a certain minimum amount when then endowment policy matures.

Why don't you get the entire year's gains as a bonus?

On the one hand, the insurance companies and their fund managers want you to have as much security as possible - hence the reversionary bonuses which cannot be taken away at a later date.

On the other hand, they are also trying to maximise long-term growth by investing your money in stocks and shares, property, gilts, and cash. All of these involve a degree of risk.

What is the problem with endowments?

Anyone taking out an endowment policy, whether on a with profits or unit linked basis, has to be given a written illustration by the insurance company of how much the policy might be worth at maturity. When providing these illustrations, insurers have to make an assumption as to the rate of growth per annum that will apply to the money you are paying into the endowment. This assumed rate is known as the projected rate, and there is no guarantee that this rate will be met in reality.

Until a few years ago, the projections were usually based on a mid-range growth rate of 7.5% per annum. In the early 1980s, the assumed growth rates used in the illustrations were even higher. Therefore, the monthly endowment premiums were low by today's
standards, because they were set to reflect these high projected growth rates.

Interest rates and other economic factors, such as stock market growth and interest rates, are much lower now than they were in the 1980s and 1990s, so it has now been necessary to reduce projected rates of growth for people taking out a new endowment policy today. As a result, the monthly premiums for a new endowment policy today will be higher than they were in previous decades.

How does this affect existing policyholders?

Because actual growth rates have been lower than the projected 7.5% rate, an endowment policy taken out in the 1980s or 1990s may now not be worth enough at maturity to pay off the interest-only mortgage to which it is linked.

Insurance companies are therefore assessing the state of people's policies and contacting them to advise what action they should take now to avoid a potential shortfall at the end of their mortgage.

How will I be affected?

In most cases, if you took out a with-profits endowment in the mid-1980s or earlier, the fund should be sufficient at maturity to pay off the mortgage. This is because the money in your endowment policy will have benefited from the higher rates of interest and better stock market growth of the 1980s.

But, the shorter the length of time your endowment has been running, the greater the potential for a shortfall at maturity.

It is impossible to predict exactly how large this shortfall may be, as so much depends on future fund performance between now and the time when your endowment matures. Insurance companies are trying to assess the issue by looking at how much has been
accumulated in your fund so far and making more conservative estimates about future growth.

What can I do now?

There are a number of options:

1. You can increase payments into your existing endowment policy (subject to Inland Revenue rules), or take out additional endowment policy with the same insurer or a different insurer. However, you may decide you don't want to be tied into another
endowment.

2. You can ask to extend the term of your endowment policy, subject to your mortgage lender agreeing. This is probably not a good idea if it means your policy would continue beyond your retirement age.

3. You can set up an additional investment, such as an individual savings account (ISA). An ISA may be cheaper and can offer a wide range of investment choices to suit your attitude to risk.

4. You can ask your mortgage lender to switch part of your mortgage (equivalent to the projected shortfall on your endowment) to a repayment mortgage. You can get an idea of the costs of the new repayment part of your mortgage by using an online mortgage calculator.

5. You can use any other spare lump sum to pay off part of your mortgage. You will need to check first to see if this would make you liable for any early redemption penalties from your lender.

Which is the best option?

Everyone's situation is different, and everyone has their own particular preferences. If you are unsure what to do, you should take professional mortgage advice to help you review your options and come to a decision as to what to do.

Should I just cash in my endowment?

This would almost certainly be a mistake. Many endowment policies are structured such that the management charges are highest in the early years. If you surrender the policy early on, the amount you get back may well be less than the amount you have paid in up
until now.

Also, you need to bear in mind that a large proportion of the final value of a with profits endowment depends on its terminal bonus. The size of this bonus will not be known until the policy matures.

So, the best strategy is normally to keep the endowment in place. If you need to cut down on your monthly outgoings, you can leave a policy "paid up" (although you may incur penalties for doing this). This means that you do not pay any more money into the
endowment, but leave it to mature on the original date for a lower amount. If you do this, you will need to make sure you still have sufficient life cover to protect your mortgage.

It is possible to sell endowment policies on the second-hand endowment market. The amount you get will depend on the policy and how long it has left to run. Again, this is an area where you would be well-advised to talk to a professional before taking any
action.

Endowments and Endowment Shortfalls : What You Need To Know

Endowments and endowment mortgages have received a lot of bad press in recent years, amid concerns over falling policy values and accusations of endowment miss-selling.

This article attempts to answer some of the questions and concerns you may have about the way endowments work, what's happening to them, and what you can do to ensure your mortgage is paid off at the end of the term if you have an endowment
mortgage.

What is an endowment mortgage?

There are two basic types of mortgage. The first is a repayment mortgage, where you make one monthly payment to the lender which is part interest and part repayment of the original capital.

Then there are interest-only mortgages, where your monthly payment to the lender is just the interest on the original loan and the mortgage debt remains unchanged. You then make separate payments into an investment scheme (such as an endowment), with
the idea being that at the end of the mortgage term this investment will have grown sufficiently to repay the mortgage.

An online mortgage calculator can give you an idea of the difference in payments to your lender between an interest-only mortgage and a repayment mortgage.

Interest-only endowment mortgages were very popular in the 1980s and 1990s and were often chosen in the belief that the endowment would end up being large enough to clear the mortgage and still leave a tidy sum of money left over as a bonus.

How do endowments work?

An endowment is a long-term savings policy, typically running for ten to twenty-five years. An endowment plan has what is known as a "sum assured" value. If the policyholder dies during the life of the endowment, it pays out the sum assured. In the case of endowments linked to mortgages, the sum assured is equal to the size of the mortgage. The payout in the event of the death of the policyholder is guaranteed but, if the policyholder survives, the final value of the endowment at the end of its term is not guaranteed.

Endowments can be unit linked, which means that you buy units in a fund, or they can be "with profits".

How does money grow in a with profits endowment?

There are two ways in which a with profits endowment can increase in value. Firstly, the insurance company may add a bonus to your policy each year. This is known as a reversionary bonus and is usually a percentage of the amount of profit made by the fund over the previous years.

The amount added in this way may only be a small amount. However, once added, these bonuses cannot be taken away - hence the name reversionary bonus - and will belong to you when the policy matures.

Then there is the terminal bonus. This is a separate sum of money which the insurance company can add to your endowment policy when it matures. These terminal bonuses are discretionary and may not be applied at all.

What are the advantages of with profits endowments?

The idea of a with profits endowment is to smooth out fluctuations in the stockmarket.

With a non-with profits endowment, your investment is linked 100% to the stockmarket. Therefore, there is always the possibility that the investment value could fall just at the time when you need the money.

By using with profits endowments, insurance companies get round this problem by giving you a slightly smaller percentage of any fund growth as an annual bonus and try to smooth out future annual bonus declarations.

The point of this is to try to ensure that, no matter what happens to the returns of the fund, you are guaranteed a certain minimum amount when then endowment policy matures.

Why don't you get the entire year's gains as a bonus?

On the one hand, the insurance companies and their fund managers want you to have as much security as possible - hence the reversionary bonuses which cannot be taken away at a later date.

On the other hand, they are also trying to maximise long-term growth by investing your money in stocks and shares, property, gilts, and cash. All of these involve a degree of risk.

What is the problem with endowments?

Anyone taking out an endowment policy, whether on a with profits or unit linked basis, has to be given a written illustration by the insurance company of how much the policy might be worth at maturity. When providing these illustrations, insurers have to make an assumption as to the rate of growth per annum that will apply to the money you are paying into the endowment. This assumed rate is known as the projected rate, and there is no guarantee that this rate will be met in reality.

Until a few years ago, the projections were usually based on a mid-range growth rate of 7.5% per annum. In the early 1980s, the assumed growth rates used in the illustrations were even higher. Therefore, the monthly endowment premiums were low by today's
standards, because they were set to reflect these high projected growth rates.

Interest rates and other economic factors, such as stock market growth and interest rates, are much lower now than they were in the 1980s and 1990s, so it has now been necessary to reduce projected rates of growth for people taking out a new endowment policy today. As a result, the monthly premiums for a new endowment policy today will be higher than they were in previous decades.

How does this affect existing policyholders?

Because actual growth rates have been lower than the projected 7.5% rate, an endowment policy taken out in the 1980s or 1990s may now not be worth enough at maturity to pay off the interest-only mortgage to which it is linked.

Insurance companies are therefore assessing the state of people's policies and contacting them to advise what action they should take now to avoid a potential shortfall at the end of their mortgage.

How will I be affected?

In most cases, if you took out a with-profits endowment in the mid-1980s or earlier, the fund should be sufficient at maturity to pay off the mortgage. This is because the money in your endowment policy will have benefited from the higher rates of interest and better stock market growth of the 1980s.

But, the shorter the length of time your endowment has been running, the greater the potential for a shortfall at maturity.

It is impossible to predict exactly how large this shortfall may be, as so much depends on future fund performance between now and the time when your endowment matures. Insurance companies are trying to assess the issue by looking at how much has been
accumulated in your fund so far and making more conservative estimates about future growth.

What can I do now?

There are a number of options:

1. You can increase payments into your existing endowment policy (subject to Inland Revenue rules), or take out additional endowment policy with the same insurer or a different insurer. However, you may decide you don't want to be tied into another
endowment.

2. You can ask to extend the term of your endowment policy, subject to your mortgage lender agreeing. This is probably not a good idea if it means your policy would continue beyond your retirement age.

3. You can set up an additional investment, such as an individual savings account (ISA). An ISA may be cheaper and can offer a wide range of investment choices to suit your attitude to risk.

4. You can ask your mortgage lender to switch part of your mortgage (equivalent to the projected shortfall on your endowment) to a repayment mortgage. You can get an idea of the costs of the new repayment part of your mortgage by using an online mortgage calculator.

5. You can use any other spare lump sum to pay off part of your mortgage. You will need to check first to see if this would make you liable for any early redemption penalties from your lender.

Which is the best option?

Everyone's situation is different, and everyone has their own particular preferences. If you are unsure what to do, you should take professional mortgage advice to help you review your options and come to a decision as to what to do.

Should I just cash in my endowment?

This would almost certainly be a mistake. Many endowment policies are structured such that the management charges are highest in the early years. If you surrender the policy early on, the amount you get back may well be less than the amount you have paid in up
until now.

Also, you need to bear in mind that a large proportion of the final value of a with profits endowment depends on its terminal bonus. The size of this bonus will not be known until the policy matures.

So, the best strategy is normally to keep the endowment in place. If you need to cut down on your monthly outgoings, you can leave a policy "paid up" (although you may incur penalties for doing this). This means that you do not pay any more money into the
endowment, but leave it to mature on the original date for a lower amount. If you do this, you will need to make sure you still have sufficient life cover to protect your mortgage.

It is possible to sell endowment policies on the second-hand endowment market. The amount you get will depend on the policy and how long it has left to run. Again, this is an area where you would be well-advised to talk to a professional before taking any
action.

Selling Your Endowment? Make Sure To Weigh The Pros And Cons

Selling your endowment policy is undoubtedly a big decision. Surrendering your endowment policy is serious business. It makes sense to consult an independent financial advisor. He will help you compare offers and make a well informed decision. He will make sure you get the most for your policy. Rest assured that you will achieve the best possible price. The fee would be well worth your time and energy. When it comes to endowments selling, it is imperative to check your policy. Ensure that there is some value in selling endowment. In other words, you need to consider the advantages and pitfalls when you decide to sell your endowment. For the uninitiated, an endowment policy is a life insurance contract. It involves paying a lump sum after a specific term or on earlier death. Usually maturities are ten, fifteen or twenty years up to a particular age limit. A few policies also pay out in the event of critical illness. Policies are unit-linked or with-profits.

Endowments selling can be overwhelming. If you are looking to sell your endowment, you ought to familiarise yourself with the pros and cons of doing the same. You need to strategically weigh the pros and cons of selling endowments. An endowment policy can be surrendered or cashed in early. The holder is entitled to receive the surrender value. The insurance company determines this value depending on how long the policy has been running and how much has been paid into it. Early redemption can lead to a substantial loss but if you need money, it may be your only resort. When it comes to buying endowment, different companies have different requirements. Mostly the policy needs to be with-profits or a with-profits whole life policy that has been running for a minimum number of years.

Selling an endowment is no joke. It is unwise to suddenly stop making payments. It is foolish to cancel the policy without researching thoroughly. Make sure to seek competent financial advice and help. Remember that if you stop payments on a policy, it could lead to a major loss. You might end up losing any life assurance cover that it offered you. Endowment policies are good investment instruments. You might have to sell your endowment policy for various reasons. It is human tendency to invest money when money is available in surplus. Likewise, it is natural to withdraw the same when you are running out of cash. If you encounter a situation which compels you to sell your endowment policy, make sure to look at the best possible deals involving such transactions.

Selling endowments involves various complexities as far as final calculations pertaining to 'amount receivable' are concerned. Extensive research is important in such a scenario. Selling off your long held endowment policy is one of the biggest decisions of your life. You definitely can't afford to take chances with it. Compare offers, research thoroughly, plan meticulously. An endowment policy is a wise financial investment. It gives you benefits in terms of tax saving. It safeguards you against unforeseen or unexpected problems in the future. For more useful resource relating to endowment selling free to visit Endowment Selling Center kingsley okotie is an online writer of various topics, and his followers has been enhance with his findings today he shares some insight into endowment selling. for more useful resource relating to endowment selling free to visit Endowment Selling Center

UK Mortgage Default : May Be the Right Time to Sell Your Endowment

Avoiding Mortgage Default by Selling Endowments

The IMF just issued a warning about all economies globally. Only one country received a lower vote of confidence than the UK, and that was Italy. Although some countries such as Canada have strong commodity prices that support a more optimistic view for them, commodity prices have fallen sharply. The Canadian dollar for instance on October 10th, 2008 dropped to its lowest level in many years against the US dollar. The IMF then will likely issue many adjustments to its impression of global economies. Overall, however, it doesn't look good.

The UK banking system was hit very hard by events in the US banking industry, particularly the sub prime mortgages. Some banks were over exposed to mortgage debt and when the credit crunch hit, some were facing bankruptcy. Several mergers and acquisitions have taken place, and the end may not be near as far as bank failures are concerned. With unemployment rising, many homeowners will find paying their mortgages in the short term quite a task.

Those with large investment portfolios similarly are seeing the value of their securities falling to frightening lows. On October 7th, the UK stock market suffered its worst loss in its history. The FTSE-100 index of Britain's biggest companies dropped over 391 points to end the day down 7.9 per cent.With credit tightening worldwide, the number of business casualties will only climb and the depths to which the UK stock market hasn't quite been plumbed yet.

The UK Credit Crisis

The tightening of credit may mean only the very best qualified borrowers will be able to access a mortgage. While in London, New York USA mayor Mike Bloomberg said the looming crisis "is going to affect anyone who wants to borrow money to buy a car or a house or to expand their business or take out a student loan."

To make things worse, the UK inflation rate has hit an astounding 5.2% according to the Consumer Prices Index, the Government's preferred measure of inflation. This adds up to a situation where consumers may not be able to pay their mortgages. Those without funds to fall back on, may end up seeing their homes repossessed by lenders.

Time to Sell Your Endowment?

Mortgage endowments were a very popular financial instrument sold in the 1980's that offered life insurance and investment return. Mortgagees would be able to pay off their mortgages when they came due and still have a little more left over. Unfortunately, the highly inflationary 80's had very interest rates, which fell through the 90's and into this century. Many endowment policy holders discovered they would not pay out what they needed to pay their mortgage coming due after 25 years.

These endowment policies can be sold on the secondary market or sold to the issuing financial company. Many policyholders were hanging onto their policies hoping interest rates would rise and they would grow in value, thus covering the mortgage coming due. Unfortunately, interest rates didn't rise. Recently Uk interest rates have risen, but it's too little too late for the majority of policies sold.

Those with endowment policies might consider selling them to endowment brokers. These brokers have access to a broad range of investors who value them as solid investments. It's a great opportunity for endowment holders who would otherwise be stuck with a policy that wouldn't provide enough to pay the mortgage. Although interest rates are rising, it is unlikely banks will be paying out a great deal on securities and policies. They're in a struggle to survive and will not be generous in the next year.

If you sell your endowment to the issuing financial firm, you may be surprised at what they're offering to redeem it. Some people are shocked at how little they offer. The only other option is to sell it on the open market. By selling it to endowment brokers, prices of 10% to 35% more than redemption prices have been achieved. On a larger policy, that can amount to ten thousand pounds or more.

If you're a homeowner facing mortgage foreclosure and repossession of your home, it might be a wise move to sell your endowment to protect your investment. That gives you time to recover later and perhaps get a second mortgage to help you manage your financial debt. If you've ever thought of selling your home and moving to another country, or moving to Scotland, now may be the right time to make that move. The key to happiness and financial success really is survival. Hopefully, you'll survive this UK recession well.

With the UK economy expected to worsen, Selling Endowment Policies may be the best financial decision for those facing home repossession. Tens of thousands of endowment policies are outstanding and can be sold on the secondary market. If you think selling endowments be a good option, visit Endowmentexpress.co.uk to learn more about the advantages. On their web site, you'll be able to call direct or receive an online price quote for your endowment. Just fill out the details of your policy and you'll receive a quote fairly soon. These will be tough times ahead in the UK yet the economy is expected to improve after a few years.

Selling Your Endowment? Make Sure To Weigh The Pros And Cons

Selling your endowment policy is undoubtedly a big decision. Surrendering your endowment policy is serious business. It makes sense to consult an independent financial advisor. He will help you compare offers and make a well informed decision. He will make sure you get the most for your policy. Rest assured that you will achieve the best possible price. The fee would be well worth your time and energy. When it comes to endowments selling, it is imperative to check your policy. Ensure that there is some value in selling endowment. In other words, you need to consider the advantages and pitfalls when you decide to sell your endowment. For the uninitiated, an endowment policy is a life insurance contract. It involves paying a lump sum after a specific term or on earlier death. Usually maturities are ten, fifteen or twenty years up to a particular age limit. A few policies also pay out in the event of critical illness. Policies are unit-linked or with-profits.

Endowments selling can be overwhelming. If you are looking to sell your endowment, you ought to familiarise yourself with the pros and cons of doing the same. You need to strategically weigh the pros and cons of selling endowments. An endowment policy can be surrendered or cashed in early. The holder is entitled to receive the surrender value. The insurance company determines this value depending on how long the policy has been running and how much has been paid into it. Early redemption can lead to a substantial loss but if you need money, it may be your only resort. When it comes to buying endowment, different companies have different requirements. Mostly the policy needs to be with-profits or a with-profits whole life policy that has been running for a minimum number of years.

Selling an endowment is no joke. It is unwise to suddenly stop making payments. It is foolish to cancel the policy without researching thoroughly. Make sure to seek competent financial advice and help. Remember that if you stop payments on a policy, it could lead to a major loss. You might end up losing any life assurance cover that it offered you. Endowment policies are good investment instruments. You might have to sell your endowment policy for various reasons. It is human tendency to invest money when money is available in surplus. Likewise, it is natural to withdraw the same when you are running out of cash. If you encounter a situation which compels you to sell your endowment policy, make sure to look at the best possible deals involving such transactions.

Selling endowments involves various complexities as far as final calculations pertaining to 'amount receivable' are concerned. Extensive research is important in such a scenario. Selling off your long held endowment policy is one of the biggest decisions of your life. You definitely can't afford to take chances with it. Compare offers, research thoroughly, plan meticulously. An endowment policy is a wise financial investment. It gives you benefits in terms of tax saving. It safeguards you against unforeseen or unexpected problems in the future. For more useful resource relating to endowment selling free to visit Endowment Selling Center kingsley okotie is an online writer of various topics, and his followers has been enhance with his findings today he shares some insight into endowment selling. for more useful resource relating to endowment selling free to visit Endowment Selling Center

UK Mortgage Default : May Be the Right Time to Sell Your Endowment

Avoiding Mortgage Default by Selling Endowments

The IMF just issued a warning about all economies globally. Only one country received a lower vote of confidence than the UK, and that was Italy. Although some countries such as Canada have strong commodity prices that support a more optimistic view for them, commodity prices have fallen sharply. The Canadian dollar for instance on October 10th, 2008 dropped to its lowest level in many years against the US dollar. The IMF then will likely issue many adjustments to its impression of global economies. Overall, however, it doesn't look good.

The UK banking system was hit very hard by events in the US banking industry, particularly the sub prime mortgages. Some banks were over exposed to mortgage debt and when the credit crunch hit, some were facing bankruptcy. Several mergers and acquisitions have taken place, and the end may not be near as far as bank failures are concerned. With unemployment rising, many homeowners will find paying their mortgages in the short term quite a task.

Those with large investment portfolios similarly are seeing the value of their securities falling to frightening lows. On October 7th, the UK stock market suffered its worst loss in its history. The FTSE-100 index of Britain's biggest companies dropped over 391 points to end the day down 7.9 per cent.With credit tightening worldwide, the number of business casualties will only climb and the depths to which the UK stock market hasn't quite been plumbed yet.

The UK Credit Crisis

The tightening of credit may mean only the very best qualified borrowers will be able to access a mortgage. While in London, New York USA mayor Mike Bloomberg said the looming crisis "is going to affect anyone who wants to borrow money to buy a car or a house or to expand their business or take out a student loan."

To make things worse, the UK inflation rate has hit an astounding 5.2% according to the Consumer Prices Index, the Government's preferred measure of inflation. This adds up to a situation where consumers may not be able to pay their mortgages. Those without funds to fall back on, may end up seeing their homes repossessed by lenders.

Time to Sell Your Endowment?

Mortgage endowments were a very popular financial instrument sold in the 1980's that offered life insurance and investment return. Mortgagees would be able to pay off their mortgages when they came due and still have a little more left over. Unfortunately, the highly inflationary 80's had very interest rates, which fell through the 90's and into this century. Many endowment policy holders discovered they would not pay out what they needed to pay their mortgage coming due after 25 years.

These endowment policies can be sold on the secondary market or sold to the issuing financial company. Many policyholders were hanging onto their policies hoping interest rates would rise and they would grow in value, thus covering the mortgage coming due. Unfortunately, interest rates didn't rise. Recently Uk interest rates have risen, but it's too little too late for the majority of policies sold.

Those with endowment policies might consider selling them to endowment brokers. These brokers have access to a broad range of investors who value them as solid investments. It's a great opportunity for endowment holders who would otherwise be stuck with a policy that wouldn't provide enough to pay the mortgage. Although interest rates are rising, it is unlikely banks will be paying out a great deal on securities and policies. They're in a struggle to survive and will not be generous in the next year.

If you sell your endowment to the issuing financial firm, you may be surprised at what they're offering to redeem it. Some people are shocked at how little they offer. The only other option is to sell it on the open market. By selling it to endowment brokers, prices of 10% to 35% more than redemption prices have been achieved. On a larger policy, that can amount to ten thousand pounds or more.

If you're a homeowner facing mortgage foreclosure and repossession of your home, it might be a wise move to sell your endowment to protect your investment. That gives you time to recover later and perhaps get a second mortgage to help you manage your financial debt. If you've ever thought of selling your home and moving to another country, or moving to Scotland, now may be the right time to make that move. The key to happiness and financial success really is survival. Hopefully, you'll survive this UK recession well.

With the UK economy expected to worsen, Selling Endowment Policies may be the best financial decision for those facing home repossession. Tens of thousands of endowment policies are outstanding and can be sold on the secondary market. If you think selling endowments be a good option, visit Endowmentexpress.co.uk to learn more about the advantages. On their web site, you'll be able to call direct or receive an online price quote for your endowment. Just fill out the details of your policy and you'll receive a quote fairly soon. These will be tough times ahead in the UK yet the economy is expected to improve after a few years.

Understanding What Endowment Selling is All About

For endowment selling to take place one has to be the owner of an endowment policy. An endowment policy is a policy taken out with an insurance company for over a specific period. The time frame can be anywhere from ten years to twenty years. It promises that upon maturity the holder will receive a guaranteed amount along with any bonuses or interests accumulated over the period. Should the policy holder die the beneficiary will receive the amount. Of course this is all subject to specific terms and conditions.

The holder of an endowment policy, traditionally called a with-profit endowment, basically expects that upon maturity the amount received from the insurance company is in excess of the sum assured. The holder usually has a plan for the monies; education for children and mortgage pay off may sit at the top of the list. The policy is usually taken out with an intent or purpose. The policy holder also has the option to partake in the act of endowment selling, which is interpreted as the sale of the policy to an external party outside of the insurance company. This allows the holder to sell the policy prior to maturity. The policy holder does have the option of surrendering the policy to the insurance company; however a third party sale would usually pay more than the insurance company would reimburse at any given time.

When endowment selling happens, an endowment policy is commonly referred to as a Traded Endowment Policy. A market has certainly developed over time for the purchasing of these with-profit policies as yet another form of investment. The sale can be initiated by the interested third party or the policy holder. Upon finalising the sale, all benefits, inclusive of that received upon death, passes to the new policy owner. The premium payments become the responsibility of the new policy holder until maturity.

Once the two parties involved have agreed to the endowment selling, the legal part of the transaction, involving documents will begin. The necessary paper work will be forwarded to the intended purchaser with a letter authorising access of information from the insurer. This allows for the obtaining of the surrender value of the policy and any other necessary information in order to arrive at the selling price.

When a policy holder is considering the process of endowment selling, it is advisable that some thought be given to the future before agreeing on a sale. Money may be required immediately which may leave no alternative but to sell. The policy holder should explore all possible options before proceeding with the sale. It is imperative that there is a level of comfort with the decision made to sell the policy prior to maturity. The flip side of this transaction is that the lump sum received from the sale can also be invested. The results of the investment being more than what would have been accumulated at the maturity date of the endowment policy.

When one has a keen interest to learn, research and share information, the sky is the limit!

Understanding What Endowment Selling is All About

For endowment selling to take place one has to be the owner of an endowment policy. An endowment policy is a policy taken out with an insurance company for over a specific period. The time frame can be anywhere from ten years to twenty years. It promises that upon maturity the holder will receive a guaranteed amount along with any bonuses or interests accumulated over the period. Should the policy holder die the beneficiary will receive the amount. Of course this is all subject to specific terms and conditions.

The holder of an endowment policy, traditionally called a with-profit endowment, basically expects that upon maturity the amount received from the insurance company is in excess of the sum assured. The holder usually has a plan for the monies; education for children and mortgage pay off may sit at the top of the list. The policy is usually taken out with an intent or purpose. The policy holder also has the option to partake in the act of endowment selling, which is interpreted as the sale of the policy to an external party outside of the insurance company. This allows the holder to sell the policy prior to maturity. The policy holder does have the option of surrendering the policy to the insurance company; however a third party sale would usually pay more than the insurance company would reimburse at any given time.

When endowment selling happens, an endowment policy is commonly referred to as a Traded Endowment Policy. A market has certainly developed over time for the purchasing of these with-profit policies as yet another form of investment. The sale can be initiated by the interested third party or the policy holder. Upon finalising the sale, all benefits, inclusive of that received upon death, passes to the new policy owner. The premium payments become the responsibility of the new policy holder until maturity.

Once the two parties involved have agreed to the endowment selling, the legal part of the transaction, involving documents will begin. The necessary paper work will be forwarded to the intended purchaser with a letter authorising access of information from the insurer. This allows for the obtaining of the surrender value of the policy and any other necessary information in order to arrive at the selling price.

When a policy holder is considering the process of endowment selling, it is advisable that some thought be given to the future before agreeing on a sale. Money may be required immediately which may leave no alternative but to sell. The policy holder should explore all possible options before proceeding with the sale. It is imperative that there is a level of comfort with the decision made to sell the policy prior to maturity. The flip side of this transaction is that the lump sum received from the sale can also be invested. The results of the investment being more than what would have been accumulated at the maturity date of the endowment policy.

When one has a keen interest to learn, research and share information, the sky is the limit!

Sell Endowment Policy : Should I Sell My Endowment Policy?

I have found several advertisements in national papers recently from companies offering to sell my endowment policy. However, which is the best option to get the best return?

It is estimated that over 4 million with-profits endowment policies were sold by insurance companies in the eighties and nineties. These policies were designed to last for up to 25 years and increase in value each year as a bonus is added to the amount of money that you paid in every month plus an estimated big bonus at the end of the term. Most of these policies were estimated on annual bonuses accruing at up to 9%, however in reality, with the fall in interest rates over the last 10 years, most policies are currently returning less than 1% per year.

These with-profits endowment policies were sold as a means to repay an interest only mortgage at the end of the mortgage period. Industry experts now predict that 9 out of 10 policies will not reach their target figure to repay the mortgage. With nearly 4 million policy holders having been informed by their insurance companies of the potential endowment shortfall, there is a big market out there for Traded Endowment Policies.

Many people have now made other provisions for paying off there mortgage, like converting them to a repayment type where the monthly payments include both interest and capital. So what do you do with your old policy?

Selling your endowment policy may give you a better return than just to cash in or surrender your endowment policy. However you may want to replace the life insurance component with a more suitable product.

I decided to sell my endowment policy and I accepted an offer that was 10% higher than the surrender value so I was happy. If you think it is time to sell your endowment policy then make sure that you check out all your options, starting with contacting your insurance company to get a valuation. They will advise you on any alternative options that they can offer to you as well. Read more about what investigations I did before selling my endowment policy at http://SellEndowmentPolicyReview.com

Sell Endowment Policy : Should I Sell My Endowment Policy?

I have found several advertisements in national papers recently from companies offering to sell my endowment policy. However, which is the best option to get the best return?

It is estimated that over 4 million with-profits endowment policies were sold by insurance companies in the eighties and nineties. These policies were designed to last for up to 25 years and increase in value each year as a bonus is added to the amount of money that you paid in every month plus an estimated big bonus at the end of the term. Most of these policies were estimated on annual bonuses accruing at up to 9%, however in reality, with the fall in interest rates over the last 10 years, most policies are currently returning less than 1% per year.

These with-profits endowment policies were sold as a means to repay an interest only mortgage at the end of the mortgage period. Industry experts now predict that 9 out of 10 policies will not reach their target figure to repay the mortgage. With nearly 4 million policy holders having been informed by their insurance companies of the potential endowment shortfall, there is a big market out there for Traded Endowment Policies.

Many people have now made other provisions for paying off there mortgage, like converting them to a repayment type where the monthly payments include both interest and capital. So what do you do with your old policy?

Selling your endowment policy may give you a better return than just to cash in or surrender your endowment policy. However you may want to replace the life insurance component with a more suitable product.

I decided to sell my endowment policy and I accepted an offer that was 10% higher than the surrender value so I was happy. If you think it is time to sell your endowment policy then make sure that you check out all your options, starting with contacting your insurance company to get a valuation. They will advise you on any alternative options that they can offer to you as well. Read more about what investigations I did before selling my endowment policy at http://SellEndowmentPolicyReview.com