MIp21_0210:MI 2008 21/01/2010 17:15 Page 5
Equity release news
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No sheep following as Wales leads equity release
Jon King, MD at
Wales was the surprise front flummoxed as to why Wales was Key Retirement is offering
Hodge Lifetime,
runner in the equity release market proving so resilient when all other brokers the chance to win a Mini
and one of only two UK regions to regions bar East Anglia were Cooper in an April draw. considers a
show year-on-year positive growth, reporting steep declines. “From an All you have to do is register to refer
Key Retirement Solutions’ (KRS) anecdotal perspective Wales is any clients interested in equity release growing
market monitor revealed last similar to Scotland but it’s also to Key. For registering, referral
month. unpredictable in terms of what partners receive 1 entry into the draw; understanding
Wales topped the list of regions business can come out of there,” he for referring a client, 2 entries; and if
with a staggering 8% growth in the said. “Why is Wales doing so well? I the client proceeds to application, a
of equity
number of new plans. Only East honestly have no idea. further 3 entries. Existing registered
Anglia came close to Wales, with “Historically we have found that individual partners will automatically
release
KRS reporting 7% growth in the in areas such as this it has taken receive 1 entry.
region. All ten other regions longer to take a foothold so maybe The incentive runs until 30 April and
Professional mortgage
reported negative declines. it is taking longer to catch-up,” he the prize will be presented to the
intermediaries have always
Northern Ireland, Scotland and the added. “However I don’t mind that winner in May. The promotion comes been interested in equity
North recorded the heaviest it is bucking the trend. There is a as Key celebrates receiving its release – after all it’s a natural
declines of - 47%, -38% and -28% good level of business in Wales and 10,000th referral. The company paid fit for the typical business
respectively. we have responded to the demand out an average of over £750 per
model. It also opens up the
Dean Mirfin, Key Retirement accordingly by putting another completed case in 2009 – up from £691
potential to access a group of
Solutions group director, was adviser in there.” per case in 2008.
people who many would not
have previously dealt with as a
Rise in ignorance over retirement age
house move is not typically
involved. These retired people
are also related to the existing
Nearly half (47%) of 45 to 49 Government in 2004 - will pension benefits and any tax-free
year-olds and two-fifths (39%) of prevent many people aged cash allowance still have nearly
clients of brokers and therefore
50 to 54 year-olds are unaware of between 50 and 55 from claiming three months to decide what they
a great source of referrals.
the rise in the minimum private or company pension want to do.
Concerns over advice have
retirement age from 50 to 55 benefits and especially taking the "Prudential strongly urges
stopped many from getting
which comes into effect on 6 April tax-free cash element of their people approaching retirement to
actively involved, with some
this year, new research from pension fund until they are 55. contact a financial adviser or talk
choosing to refer to another
Prudential shows. For those who had planned to to their pension provider about
firm. The recent changes to
And the increase in the retire at 50, the higher minimum the options available.
the fringes of the benefits
minimum retirement age could be age will mean five years without "The Government first
system for elderly home owners
a particular blow to people aged access to pension benefits or tax- announced the changes to
with mortgages, are indicative
50 to 55 who are planning to free cash. minimum retirement age nearly of a gradual sea change in
retire this year, Prudential warned. Prudential's research has found six years ago so there has been attitudes in Government, and
Prudential is urging people that 6% of the UK's 3.9 million plenty of time for the news to sink which brokers would be well
who will be affected by the adults aged 50 to 54 - equivalent in. It is worrying that so many are
advised to be aware of.
increase in minimum retirement to more than 230,000 people - still unaware but there is time to
The debate over the funding
age to speak to financial advisers said they planned to retire in act before rules change."
of long term care is bound to
ahead of the 6 April deadline and 2010. The changes to the minimum
be central to the political
stresses there is still time to act. Karin Brown, director of retirement age will not affect
agenda regardless of who wins
The new minimum retirement annuities at Prudential, said: those people who plan to retire
the election. Demographics
age - first announced by the "People who want to take their after they are 55.
will allow nothing else. The
Bridgewater raises maximum limits
politicians are becoming much
more aware of the fact that
Bridgewater Equity Release has Release, commented: “Bridgewater maximum as part of a robust risk
housing wealth is very much
raised the maximum amount of continues to lead the home management process which allowed
part of the answer. After all,
cash available to be released reversion sector in terms of product us to keep products on the shelves
councils have been taking
through its range of home offering; we are the first provider to throughout a particularly difficult
charges on houses to cover care
reversion plans to £250,000 from its raise our maximum release and the period for the market. That
for many years - something
previous limit of £100,000. £250,000 amount is substantially decision ensured that our releases
clients are well aware of.
The increased £250,000 release is more than most of our competitors remained available to as many
And the new Trigold system
available for all Bridgewater’s home left in the market. This is proof customers as possible. We have now
to guide brokers through the
reversion products including the positive of our commitment to the entered 2010 with an intention to advice process is to be
maximum release plan, flexible market and we will continue to build on our position of leadership welcomed as a real milestone,
release plan and secured escalating ensure our customers can release in the home reversions sector and on a journey many mortgage
release plan. the equity they need through a this increase in the maximum
professionals are taking to grow
Peter Welch, head of sales and Bridgewater home reversion plan. release available to £250,000 shows
their understanding of equity
distribution at Bridgewater Equity “We introduced the £100,000 the way forward.”
release.
www.mortgageintroducer.com February 2010 Mortgage Introducer
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