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Equity release
21
Finding the
solution
Alison Beeston, compliance &
communications manager at
Bridgewater Equity Release,
considers how to decide on the
right solution for your clients
n this article I continue my look at should the adviser begin the next phase of circle6 Alternative fund-raising methods are less
I
the overall sales process for equity product research. This is particularly important suitable such as, in particular, a home
release advisers looking at key areas where the client is wishing to raise a small reversion plan (where a lifetime mortgage is
such as how to go about making the additional income or cash sum as there may recommended), a lifetime mortgage (where a
advice decision and the research that be other benefits or grants that can meet the home reversion plan is recommended) and,
is needed to get to this point. You’ll need. where relevant, a local authority or other
note that I haven’t provided product- grant.
specific information as this will be up to FSA guidance The issue of benefit entitlement is vitally
individual advisers to keep on top of. In terms of measuring the suitability of the important to any assessment of the client’s
Indeed, as product developments and equity release product to the client we can suitability for equity release. It is estimated
changes can happen constantly it is vital that again look at the FSA guidance on this. A that well over 1 million of the UK’s elderly
the equity release adviser spends a product will be suitable if the firm has population are not claiming means-tested
significant amount of time keeping abreast r benefits for which they are entitled. The
of product updates and literature. circle6
easonable grounds to conclude that:
two main benefits which are means-tested
So, how does an adviser go about deciding circle6
The customer can afford to enter into it
It is appropriate to the customer’s needs and and therefore could be affected by equity
on the solution they will put to their clients? release are the Pension Credit and Council Tax
Suitability is key. To quote the FSA: ‘A firm circle6
circumstances
It is the most suitable product within the Benefit. Although advisers are not expected to
must take reasonable steps to ensure that any scope of service provided. This means that, be experts in this area it is advisable they have a
personal recommendation to a customer to an adviser stating they offer advice from the good working knowledge so as to sensibly
enter into a…equity release transaction is whole of the market and are independent, advise the client. There are a number of
suitable for that customer.’ Only when an has no excuse not to look at every product different tools and aids that advisers can use to
adviser is confident that equity release is
appropriate for the client(s) at this point in circle6
available in the equity release sector. help in this regard including Equibis, Fintal
The customer benefits outweigh any adverse and entitledto.com. Advisers should ensure
time, and all other means of meeting the effect on the customer’s entitlement to they keep the subsequent reports on file to
clients’ requirements have been fully explored, means-tested benefits and their tax position demonstrate their research in this area.
www.mortgageintroducer.com July/August 2009 Mortgage Introducer
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