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Equity release Equity release
Bad light incredulous that some – again I emphasis some Focusing specifically on equity release
It can be easy to nit-pick results which show up – advisers see this as something they have to do advice, some examples of the critical areas on
your sector in a bad light. Many could point rather than embracing it in their sales process. which clients’ opinions need to be questioned
the relatively small numbers mystery shopped Explaining an IDD provides the perfect
in relation to the number of advisers out there scenario for an adviser to reassure and sell circle6
are:
What do they think will happen to house
but the fact remains that advisers not doing themselves to the client and all too many
their job properly are indefensible. Which? advisers are still missing this trick. It provides a circle6
prices over your lifetime?
What is their anticipated lifespan and is this
should therefore be congratulated for giving great platform to demonstrate their more likely to get longer or shorter over
the industry a chance to put its house in order. professionalism and set out how they do
The industry continues to work hard in business. circle6
time?
In the event of needing care in the future,
order to heighten consumer awareness to the Previous financial services mis-selling
genuine benefits of this sector and continued scandals have been as a result of advisers not circle6
what is most important to them?
What is more important – guaranteeing that
improvement is required in order to keep setting out all the available options to the clients a proportion of the value of the home is left
moving forward. There is certainly no room for based on inappropriate assumptions of the to pass on to beneficiaries at a later date or
complacency and it is vital that standards are future - remember mortgage endowment plans.
impeccable as this is such an emotive area of circle6
keeping their name on the deeds?
How much risk are they prepared to take?
the market. This report may not be an entirely Misconceptions The FSA has also conducted its own
true representation of the equity release sector Advisers must recognise the risks associated exercise looking at the quality of equity
as the majority of advice given is through firms with the assumptions and possible release advice and found similar worrying
with an excellent degree of knowledge and misconceptions they bring to each client signs as those discovered by Which? It has
robust advice procedures firmly in place but interview. Advisers in all firms should no plans to publicise its findings but will
the result mustn’t be dismissed out of hand. constantly review and challenge their own just take action where it finds it necessary.
Having said this I do find it amazing that, ass
even now, we find advisers not undertaking the circle6
umptions by asking themselves: So with this in mind it is more important
Am I asking my clients for their opinion on than ever that advisers are fully aware of
basic aspects of an advice process. Advisers the assumptions on which I base my advice any potential recriminations.
need to urgently change their state of mind
regarding the aspects that are laid down under circle6
e.g. house price inflation? But it should also be remembered that
Am I really listening to what my clients tell it’s never too late for advisers to get their
the FSA rules. There are still some advisers out
there who are not properly utilizing items such circle6
me and recording it? house in order. Help is always available for
On whose assumptions do I actually base my those in need and a good provider will
as the IDD as a sales tool. It is a regulatory
requirement that this document has to be circle6
advice? always support those seeking help to
Do I really understand the client’s attitude to learn and improve for the good of the
handed out and fully explained so I find it the risks associated with the assumptions used? industry.
October 2009 Mortgage Introducer www.mortgageintroducer.com
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