First up, could I ask everyone active or interested in being active in the equity release/later life market, to go and watch the ITV Tonight programme entitled, ‘Cash in your house: deal or no deal’. You’ll find it on the ITV hub or catch-up.
It is lowest-common denominator stuff, and while it’s certainly not a hatchet job on the equity release sector, some of it will make the blood boil; for instance, it does that old trick of somehow suggesting that the shared appreciation mortgages of yester-year are the equivalent of the fully-regulated equity release products of today.
Quelle surprise, you might think, plus it also attempts to suggest that entirely transparent parts of equity release solutions often come as a surprise to those that have taken them out. Again, in our heavily-regulated world and for those taking specialist advice, these aspects of equity release should come as absolutely no surprise.
And there, perhaps, is the rub in all of this. The notion and importance of advice. At the end of the programme, viewers were urged to take specialist financial advice but throughout there are a number of people who, we are told, ‘carried out the research themselves’, and some talking heads who seem to suggest that the notion of compound interest is somehow less than transparent in these products.
But, what should however interest every adviser – and those contemplating their involvement – is the point in the programme where a specialist adviser sits down with four different potential customers. The adviser diligently outlines the key areas, the progress that has been in terms of product choice, and some of the options now available including overpayments, downsizing and inheritance protection, plus of course the impact lump-sums can have on benefits, etc.
Now this is of course a normal part of any adviser’s interaction with a potential equity release customer, but to see this on TV might actually be something of a first. The positives are there to view and the confidence it gives these ladies and the greater level of understanding they now have about the products, what it can do for them, and what their responsibilities would be, is truly informative.
This is really what we need to be striving for in terms of consumer education – it’s just unfortunate that there is still a need from a mainstream media perspective to introduce a degree of scare-mongering, a suggestion that customers are not fully informed, or indeed that we are somehow still operating in the market of the 1980s/90s.
However, for all practitioners or potential practitioners, I suspect they will leave the programme perhaps more heartened than we would have done after various other media ‘exposes’ of our sector. And that certainly seems to be progress from my perspective.
Especially when you add in the likely growth in demand as older homeowners realise what is achievable, and the opportunities for advisers that exist in later life lending as a sector, plus of course the technology that we have now to make any entry into the sector – or indeed ongoing work within it – that much easier.
We should not underestimate this because, as product choice, criteria and options have grown, so has the need for better tech to source this market, and to make the most of those older clients, whether it’s from an equity release or RIO or mainstream lending perspective. Criteria shifts rapidly now and being able to work across customer need/product choice/rates/criteria, and everything else, requires a quality technology solution.
For those advisers and firms who want to do more in this area, the good news is that the tech already exists and coupled with greater consumer understanding and demand, we should all be able to appreciate that by striking a more positive tone, and outlining the reality of today’s sector, we can make a significant difference to many people’s lives.
Stuart Wilson is CEO at Air Group