IMLA panel: Older borrowers being advised in silos

Ryan Bembridge

September 16, 2016

silo

An Intermediary Mortgage Lenders Association panel has called for older people to be given more comprehensive financial advice.

The panel, which included Kate Faulkner, property analyst, Simon Read, former personal finance editor of The Independent and Andrew Montlake, director of London brokerage Coreco, agreed that lenders and advisers can do more.

Faulkner said: “The service we provide in this silo-fashioned day does not work for the consumer at all – we can’t give life advice.

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“Some of the most successful agents I deal with have an IFA in their office who is also a broker and they have a legal person next door. We have to move to that.

“Some brokers are doing a good job but actually as an industry it’s just not working.”

In her case when advising Faulkner likes to give legal guidance or refer her clients to legal experts to provide a well-rounded service.

Read reckoned it’s time to stop thinking about products and start thinking about service.

He said: “There’s a whole range of products: it could be equity release, a lifetime loan, it could be something else, but put the service first and maintain that, so year-after-year if one of them does die the lender is on hand to help them rearrange their finances.

“So forget about the products. This is what I’d like to see from building societies and banks.”

Read told the audience to imagine how you would give advice to a relative such as an aging aunt – he said you would tell them what you know before referring them to someone else who can help rather than saying ‘here’s the product’ and bolting.

Montlake agreed that there is a lack of joined up thinking with advice, while he also questioned the logic of having age caps on buy-to-let loans.

He said: “You get some clients who go to a mainstream broker or an equity release broker and they are two very different products.

“As an industry how to we bring them together to ensure they get the right product?”

He added: “I think there’s still got a long way to stop the ageism tag which is still there – for me affordability is affordability.

“If you underwrite someone on affordability and pension income and see that they can afford the loan then their age doesn’t come into it; it’s all about affordability.

“A lot of people get a buy-to-let to provide for their retirement so why cap that with age limits? That seems crazy to me.”