Each month we publish the best comments, emails and letters from our readers. Here are the best of June 2018.
This month's star letter: Interest-only mortgagees ‘should take responsibility’
I’ve been a mortgage borrower for nearly 37 years and will be making my final payment on my mortgage next month. When I bought my first house in the 1980s, endowment mortgages were all the rage and I signed up for my first £25,000 loan for a two-up, two-down. I also took out an endowment policy.
As we moved up the property ladder, I took out further endowment policies until I had six in total, all indicating a potential annual growth of around 6% to 8% – we all know how that ended.
When it became clear that the endowment policies would not clear my mortgage, I switched to a repayment mortgage and sold the endowment policies, also receiving mis-selling compensation from the provider. With the money raised, I made a lump sum payment into my mortgage, reducing the capital owed and future interest payments.
My point is that I don’t think Moneywise should be making excuses for borrowers who say they didn’t know they were paying interest only and would need an investment vehicle to pay off the loan in future (Moneywise, June 2018 issue). This was clearly explained to me when taking out my first mortgage and subsequent mortgages.
It seems people have chosen to ignore the reality of their situation, and then cry: “It’s not my fault, something must be done”, while enjoying the lower repayments of an interest-only mortgage.
Moneywise should be encouraging people to take personal responsibility for their financial situation, take sensible action and not encourage people to point the finger at their mortgage borrower.
Moneywise says: Thanks for getting in touch with your views on interest-only mortgages – it certainly seems to be an area that stirs up a lot of debate. We hope that by raising awareness of the interest-only issue (which some borrowers may not have understood at the point of sale), it will encourage people in this position to review their finances and to begin thinking of a repayment plan or making alternative arrangements as soon as possible.
Energy customers ‘will lose out’ over SSE fine
Moneywise says: We recently reported that supplier SSE is to pay a £1 million fine after misleading pre-payment meter users. One reader asks how it will pay the fine:
Where will the funds come from to pay this fine ? Not the management for their poor decision-making, nor the shareholders who have a stake in the company. No, it will, of course, be hidden in higher prices for customers – the very people who have been ripped off. It’s about time corporate responsibility was owned personally by those at the top who decide how the company operates. If it gets it wrong, then it should be punished, not the customer.
AQ/VIA ONLINE COMMENTS
Head north for better returns? It’s not worth it
Moneywise says: In early June, we reported that more landlords are buying up north. But one landlord says he’s staying put:
Better net returns? Probably not – unless you live up north. I live in East Anglia, and all my properties are within a 30-mile radius of home. On Wednesday I got a call to say a boiler had stopped working. I was there within the hour and fixed the problem in two minutes. Had this property been 100 miles away, I would have had to call out a plumber, at a cost of £100-plus.
AT/VIA ONLINE COMMENTS
Co-op cremation is cheap… except for the ashes
Moneywise says: The news that Co-op Funeralcare is launching a new direct cremation service that slashes funeral costs for people who do not want a traditional send-off has been welcomed by a few readers:
I have a similar plan I did a few years back with Co-op, which cost £1,150 using a space in my father’s grave. If I had used a new grave, it would have been £175 more. I have insisted that a van collects me, that I am placed in an unpolished coffin (it could not do a body bag), and a van takes me to the grave. All fees are included – what more does one need?
C/VIA ONLINE COMMENTS
At £95, the price of delivery of ashes is somewhat exorbitant if one wants to cremate at minimal charge. It may be cheaper to use Royal Mail. At least I know my postman!
MA/VIA ONLINE COMMENTS
Great idea. It’s about time something like this was offered, as funerals are ridiculously expensive. However, I am signed up to the organ donor scheme. I wonder whether the Co-op can still offer the plan?
AK/VIA ONLINE COMMENTS
Moneywise says: The organ donor process happens before any funeral arrangements are made, so Co-op says you can choose any funeral plan including cremation without ceremony.