Bridgewater surveyed advisers who deal with equity release cases and discovered that the same types of misconceptions are raised by clients time and time again when discussing equity release.
Chris Prior, sales and distribution manager at Bridgewater Equity Release, said: “The equity release sector continues to work hard to educate and inform the general public and specifically those in, or reaching, retirement about the products themselves, their potential benefits and, rather importantly, what circumstances will not arise should they opt to take out a plan.
“However as can be seen from our survey results, we still have some way to go in order to eradicate the common misconceptions that are still held by many potential customers.”
The number one misconception heard by advisers was the client’s fear that by opting for an equity release product they were somehow giving away their children’s inheritance, while a third of respondents said the client’s belief they would lose their home by taking out the plan was the most commonly-heard worry.
Finally 25% of advisers said a client’s misunderstanding that they would end up owning more than their home was worth was the point most often raised.
Not one adviser believed the most common misconception held by clients which was that they would end up losing all of their State Benefits by taking out an equity release plan.
Advisers were also asked to rate the level of knowledge clients had about equity release in general and the specific products before they met with them.
Over half (58%) said most clients had heard of the products and had a basic knowledge while nearly 18% said their clients had no knowledge at all. The same number were found to have conducted some research and had a fair knowledge base while just 7% were said to be clued up about the products and the various pros and cons of taking out a plan.