Independent advice from a specialist equity release adviser can reap rewards for the ‘canny’ homeowner
Equity release is an important and growing tool in post retirement planning, enabling older homeowners to raise cash by releasing equity from their biggest asset, their main residence.
Recent research from equity release provider Retirement Plus suggests that many people are not sure where to go to receive the best advice on equity release - but it is very important that you get the full facts before proceeding. It is not normally advisable to simply respond to an advertisement and talk direct to a single provider.
Why should you take the specialist equity release adviser route?
There are two types of equity release product – lifetime mortgages and home reversion plans, and very few providers offer both. More importantly, there are now some 60 schemes available from 22 providers under the SHIP* seal of approval (which represents well over 90% of the equity release market) – and the majority of these schemes are only found through specialist equity release advisers.
Over time, the rewards can be substantial if you take the right equity release advice.
It is very important that you choose an adviser who can offer you whole of market equity release advice, i.e. that they are FSA** authorised and fully qualified to advise on both lifetime mortgages and home reversion plans. In addition, they should offer you advice on any State benefits you may be entitled to and take full responsibility for recommending the most suitable equity release product for your needs. A few equity release providers actually offer a better product if you do take financial advice from a specialist adviser rather than approaching them direct.
Where can you find a specialist equity release adviser?
There is now a choice of dedicated specialist companies which only offer equity release advice, and as a result can negotiate better terms from the providers – these specialists can be easily found on the internet or in the weekend financial pages. Most offer face-to-face meetings or you can deal by telephone if you prefer. Alternatively, there is now a good local choice of financial advisers who are suitably qualified – take a look at www.unbiased.co.uk and www.adviserslist.co.uk or even the Yellow Pages www.yell.com. Note that a fee may be charged for this specialist equity release advice.
Finally, your own independent solicitor (under SHIP rules), should check that you fully understand the terms and conditions of your chosen equity release plan before proceeding.
*SHIP: Retirement Plus is a member of Safe Home Income Plans (SHIP), a company supported by the leading providers of equity release plans. Launched in 1991 it is dedicated entirely to the protection of plan holders and promotion of equity release plans.
**FSA: The Financial Services Authority (FSA) is an independent watchdog set up by the government to regulate financial services, which includes equity release, and to protect your rights.
01 December 2008