PROPERTY: HOME TRUTHS

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No surrender?

I have an endowment mortgage that matures in five years. I am currently paying 8.7 per cent interest and have pounds 16,000 outstanding on my mortgage. Next month I will receive a lump sum of around pounds 18,000. Is it best to pay off my mortgage and surrender the endowment policy or should I continue to pay my mortgage and place the lump sum I receive in a savings account?

A Abbots, Weston-super-Mare

Generally speaking it is not a good idea to surrender an endowment policy, particularly when it has a relatively short time left to run. The amount you receive would only be a fraction of its full maturity value. The other benefit of keeping the policy running is that it will continue to provide life cover until 2003. I think you need to consider whether the return you would get from investing your money in a savings account will be greater than the amount of interest you will pay on your mortgage. You should talk to a financial adviser who has a particular understanding of your individual circumstances.

No free files

I bought a house a couple of years ago and I now need to see a copy of my solicitor's file. He wants to charge me for providing me with a copy - can he do this? I have already paid him for the work he did.

K Haigh, Chipping Norton

The solicitors' guide to professional conduct states that when a client requires a copy of a file he should not charge for removing it from storage, but a reasonable charge may be made for delivery or for chargeable work done by a fee earner such as photocopying. Solicitors' charges vary, so you need to decide whether the proposed charge seems reasonable for the job being done.

Don't gazump me

I am thinking about buying a new house. In the late Eighties I was gazumped on three occasions. Once again I find myself wanting to move house in a rising market. Is there anything I can do to stop being gazumped?

J O'Neil, London

Buying a property is a faster process now than it used to be. However, being gazumped remains a significant risk for many buyers. Here are a few suggestions for beating the gazumper.

Lock out agreement. As you agree to proceed with surveys and searches, get the seller to agree not to negotiate with other potential buyers for a specified period. However, this will not protect you against the seller pulling out of the transaction, or waiting until after the specified period has expired to re-market the property.

Pre-contract deposit agreement. Each party agrees to pay a specified sum of compensation to the other if they withdraw from the sale or attempt to re-negotiate the price without proper justification.

Option to purchase. For a non-returnable sum you have the option for a limited period to require the seller to sell to you at the negotiated price. If surveys or searches are adverse you can still try to re-negotiate the purchase price.

The problem is getting the seller to enter into such a binding commitment. You will also have the extra cost of a solicitor preparing the paperwork.

q George Wise is managing director of NatWest UK Mortgage Services.

q Send your queries on practical property issues to: Home Truths, `Independent on Sunday', 1 Canada Square, Canary Wharf, London E14 5DL, fax: 0171-293 2043; e-mail: sundayproperty@independent.co.uk.

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