Solicitors warn intermediaries on equity release
The equity release sector has had 10,000 new customers in 2014, with £641.2m of plans being written being in the first half of 2014, a 34% increase compared to 2013.
Under legal requirements introduced by the Equity Release Council in January, solicitors must arrange face to face meetings with customers during the advice process, while customers must sign the solicitor’s certificate.
Claire Barker, chairman of ERSA, said: “Eight months into the year, we believe that advisers and solicitors are getting used to the new requirements but we are concerned that as the market expands rapidly, and new advisers may be entering the market for the first time in a while or at all, that all advisers are reminded about them.
“The requirement for customers to not only meet with a solicitor but also sign the solicitor’s certificate adds an extra layer of safeguarding and should reduce potential disputes at redemption.”
Barker added that the ERSA expects the market to continue growing in the second half of 2014.
She said: “All of the stimuli are there – lower retirement income for many from traditional sources, mortgages and other debts extending into traditional retirement years and cost of living pressures.
“In addition, homeowners are increasingly aware of their choices and the flexibility and positive options offered by equity release.
“ERSA’s belief is that all homeowners should take specialist independent financial and legal advice before proceeding and also select a provider who is a member of the Equity Release Council.
“They can then be confident that they have found the right solution for their individual, particular circumstances.”