I have commented on the ever growing popularity of Equity Release products in recent months, even dared to hope that they have turned the corner to becoming mainstream but could there be a problem?
Equity Release figures have been driven by “need” in recent years. The economy, MMR restrictions and rising levels of debt have created the perfect storm. Interest rates have dropped to unprecedented lows and providers continue to improve flexibility that will appeal to those who are caught in the interest only time bomb but there is a problem, reputation.
As advisers we see the real difference that Equity Release can make to people’s lives. We see the improvement in lifestyle that it gives to those who use it, sometimes transforming their lives by relieving stress and worries.
Ask the average retiree in the street what they understand about equity release and they will still say that they would not touch it. They will say that you are likely to lose your home, that you have to sell your home to the provider, that your beneficiaries will not inherit anything and that you might be thrown out of your house when something goes wrong.
Really? All of these things can be avoided and guaranteed against with a modern, regulated equity release scheme. So how is it that the public still believes these facts to be true when so much has changed since the 80s/90s?
Since the beginning of the millennium the way we learn has changed due to the information available on the internet and in the media. Apple have become a phenomenon, Facebook has transformed how we stay in touch, the internet has become something we could never have imagined 20 years ago and something called Google has transformed lives in almost every country in the world but still Equity Release struggles with it’s reputation. I wonder how this can be, given all the information available?
As an industry we must continue to do all that we can to maintain high advice standards, we must continue to produce excellent products and to ensure that the consumer is treated fairly. It is a travesty that so many people will not enjoy their hard earned retirement to the best of their ability due to lack of information and a poor reputation in an era that could not be better placed to avoid such issues.
By Les Pick, National Sales Manager at The Right Equity Release