Discussion about mis-selling of endowment mortgages in the 80s and 90s

[Hagar]

The crippling legacy left by endowment policies sold in the Eighties and early Nineties

Payouts on endowment policies have crashed by 75 per cent since the late Eighties and early Nineties when most were sold.

www.thisismoney.co.uk

Endowment mortgages peaked at 83% in 1988. There was some serious mis-selling going on. Yes most people were not stock market savvy back then and did not trade shares. People believed what the banks told them.
However roll on 2008 and a whole new bunch of people lost a bundle even with the advent of the Internet. Life sucks.

 

[SexyGreyFox]

Not doing yourself any favours though are you?

And you are acting like a know it all, it's really sad. You weren't there but trying to make us out to be liars. You need to get off that high horse.

 

[dlockers]

And you are acting like a know it all, it's really sad. You weren't there but trying to make us out to be liars. You need to get off that high horse.

You're projecting, I've stated my position many times. 'baffled' is one of them. At least I can point to this when boomers talk about how dumb my generation are

 

[Kenai]

We are all liars according to the 'experts' in here.
Apparently they 100% know that we were definitely told it was based on the stock market and investments by the bank.

Purely from a curiosity perspective... if they didn't tell you that's how it worked, what did they tell you?

Surely at some point even basic common sense would suggest that if you're putting money into something, it doesn't just magically become worth more all by itself and so *something* had to be happening for it to be cheaper than a repayment mortgage but to also be able to repay your mortgage and give you a bonus lump at the end?

 

[dlockers]

Purely from a curiosity perspective... if they didn't tell you that's how it worked, what did they tell you?

Surely at some point even basic common sense would suggest that if you're putting money into something, it doesn't just magically become worth more all by itself and so *something* had to be happening for it to be cheaper than a repayment mortgage but to also be able to repay your mortgage and give you a bonus lump at the end?

NEW CAR!!!!11

 

[Slam62]

Purely from a curiosity perspective... if they didn't tell you that's how it worked, what did they tell you?

Surely at some point even basic common sense would suggest that if you're putting money into something, it doesn't just magically become worth more all by itself and so *something* had to be happening for it to be cheaper than a repayment mortgage but to also be able to repay your mortgage and give you a bonus lump at the end?

Unrealistic but persuasive projections and loads of commission for the salesmen. But yes we new nothing about the thing we were buying.
The only way that would be no risk would be repayment but then you wouldn't have all that free extra cash at the end would you.
In my case it was a low start product as well.

 

[Kenai]

Unrealistic but persuasive projections and loads of commission for the salesmen. But yes we new nothing about the thing we were buying.
The only way that would be no risk would be repayment but then you wouldn't have all that free extra cash at the end would you.
In my case it was a low start product as well.

Yeah but persuasive projections of what?

If they weren't showing projections of investment performance, what was it? Projections of how fast the magic money tree was going to grow?

 

[Slam62]

Yeah but persuasive projections of what?

If they weren't showing projections of investment performance, what was it? Projections of how fast the magic money tree was going to grow?

They gave you three sets of numbers for different percentage returns, something like 3,5 and 7, the numbers looked lovely.

 

[Mercenary Keyboard Warrior]

MKW is an old dude too. Read his posts further up.

I should take offence at that!

Yeah but persuasive projections of what?

If they weren't showing projections of investment performance, what was it? Projections of how fast the magic money tree was going to grow?

Magic.

 

[dlockers]

I should take offence at that!

I was going to temper it, but I know you boomers have asbestos* hands!

*another gift of the boomers

 

[Slam62]

Also I was about 23 at the time, the mortgage was with Bradford and Bingley

 

[Mercenary Keyboard Warrior]

I was going to temper it, but I know you boomers have asbestos* hands!

*another gift of the boomers

I'm not that old, i'm not a boomer (Gen X)

 

[dlockers]

I'm not that old, i'm not a boomer (Gen X)

Wanna go and take some finance out on some junk we don't need together? <3

Edit: Swing and a miss again! I don't even know what to blame you guys for.

 

[Kenai]

They gave you three sets of numbers for different percentage returns, something like 3,5 and 7, the numbers looked lovely.

Maybe i'm not phrasing the question right but returns of what?

If we're working from the statement that investments, stocks etc. were absolutely not mentioned at all, what on earth did people think those projections and percentages were?

 

[Slam62]

If you new what went on in the eighties and nineties

 

[Slam62]

Maybe i'm not phrasing the question right but returns of what?

If we're working from the statement that investments, stocks etc. were absolutely not mentioned at all, what on earth did people think those projections and percentages were?

Just returns on the money you paid in like a savings account.
Friends provident was the firm. Low cost with profits endowment policy. We believed everything back then, well I did, soon learned a couple of years later when I got made redundant.

 

[dlockers]

If you new what went on in the eighties and nineties

Literally the only man who cleared his mortgage, took £18k profit to buy a brand new car, but STILL disappointed because he thought returns was a kinky time.

 

[Mercenary Keyboard Warrior]

Maybe i'm not phrasing the question right but returns of what?

If we're working from the statement that investments, stocks etc. were absolutely not mentioned at all, what on earth did people think those projections and percentages were?

Your going to struggle to get an answer to that since they were IMO quite clear it was investing in the stock market

Wanna go and take some finance out on some junk we don't need together? <3

Edit: Swing and a miss again! I don't even know what to blame you guys for.

Well we had relatively cheap housing, but sucky unemployment.
We got to watch the falklands war and were brought up on WW2 so we still thought of us as a powerful nation.
We saw the end of bonkers inflation (until recently).
If you really want to blame us for stuff it should be big hair, soft rock, yuppies and shoulder pads.

 

[CapitalOne]

Gen X quietly stays out of this generational war as on one side are our parents and on the other side our kids!

 

[Kenai]

Just returns on the money you paid in like a savings account.
Friends provident was the firm.

That's what I was trying to understand, so people thought they were effectively being sold a savings account but with a different name and astronomical returns, with no reason to question how or why such massive returns might be possible.

I'm still not sure how it passes the common sense test personally, you rarely get something for nothing and even without modern financial regulations etc. in place, I struggle to wrap my head around how people would so readily accept that they could just give someone money and they'd give them back loads more money just .... because? and not want to question how any of that would or could work?