Advisers who are reluctant to discuss equity release could see their clients miss out on a bumper retirement income, according to a leading provider.
Despite a recent surge in the popularity of lifetime mortgages, which enable older people to free up cash tied up in their homes, Stuart Wilson, channel marketing director at More 2 Life, told FTAdviser not enough was being done to engage with potential clients.
His comments came as the lifetime mortgage provider geared up for the second phase of a campaign to highlight the importance of advice around later-life lending, entitled The Bigger Picture.
Mr Wilson said: “We think some advisers are not discussing the topic properly with their clients. For some, they are not the specialist and they may not be familiar with the modern features of products.
“There are a large number of advisers who have the qualifications and are not practising or doing the odd case here and there.
“If advisers are not going to specialise, they should be referring to a specialist who does. As a lender, we want to see more distribution - but at the same time for advisers only to refer to a specialist.
“There is no shortage of advisers; there is a shortage of people having the conversation. There are still a lot of myths around equity release. I don’t think enough consumers are aware how flexible the product is.”
Recent figures from the Equity Release Council showed lifetime mortgages had surpassed buy-to-let remortgaging to become the fastest-growing segment of the mortgage market.
The volume of lifetime mortgage customers surged by 22 per cent in 2016, with a total of 27,534 new plans agreed, while the value of lending passed the £2bn mark.
Peter Matthew, managing director at Penzance-based Jacksons Wealth Management, said he thought most advisers would refer clients to an equity release specialist under the right circumstances.
“I think any decent adviser would not want to limit a client’s options to just the things they themselves are able to do,” he continued. “Most advisers would want to help the client and they should have a good process for doing that.
“Equity release is a great idea for people in certain circumstances. An adviser, to my mind, would be negligent if they did not consider every way of dealing with a client’s needs, even if they can’t deliver it."
In the past, concerns have been raised about the quality of advice provided around equity release – but Mr Jackson said good advisers should take steps to ensure their clients are fully aware of the potential pros and cons.
“For the right client, in the right situation, who understands the implications, it is a great idea.”
simon.allin@ft.com
