Potential Endowment Mortgage Customers

• Think very carefully about obtaining an endowment mortgage. While the arrangement seems beneficial to all parties, a 2005 article by the BBC reported that nearly eight of every 10 endowment mortgage insurance policies were short. This means that all of those borrowers must make new arrangements to begin paying down the balance of the principal on their loans. The agreements are set up as investments--that is, there is no guarantee that a policy will ultimately pay off the mortgage in full.
  
  

Current Endowment Mortgage Customers

• If you have an endowment policy already with your mortgage, contact your insurance company and ask about the status of your investment. If the investment is performing well, do nothing. However, if the policy is in arrears (money is owed), you'll need to do one of two things: either remortgage to change the account into a repayment mortgage (where you'll be paying both principal and interest) or begin paying more into the endowment in the hope that the bump will push the policy into the black. The first option is recommended by most experts.
  
  

Unethical Sales Practices

• Some believe that many endowment mortgages were made without proper disclosure. As the policies begin to sour, many complaints have been filed by consumers who believe they had been duped by unethical loan officers. If you feel you've been a victim of such a practice, make sure to contact the Financial Ombudsman Service in central London. (See Resources section.)