Retirement Advantage has launched an enhanced range of equity release products which do not require affordability assessments to be completed as part of the application process.
The products are a response to the Financial Conduct Authority (FCA)’s decision to offer modified rules around these assessments for hybrid lifetime mortgages.
According to Retirement Advantage, these enhanced products are a first in the interest-paying lifetime mortgage market and will ease the application process for consumers and advisers while retaining all-important safeguards.
The changes apply to Retirement Advantage’s interest select equity release products and, in line with the rules, require no proof of income or expenditure on behalf of the applicant. There is also no need for customers to provide details of unsecured loans. In addition, the products retain the flexibility for customers to switch to an interest roll-up mortgage if they wish, without facing repossession.
Alice Watson, product and communications manager at Retirement Advantage Equity Release, said: “The FCA’s decision to change their stance on affordability assessments last month was a welcome common sense move. The change will open the door for new products and we’re pleased to be the first to bring modified solutions to market. There’s no doubt that these changes to our flagship interest select products will smooth the application process and make lives easier for advisers and customers alike.
“Critically, though, these products retain all the safeguards customers expect from equity release products. In addition to the safeguards, the financial adviser providing the recommendation will still ensure making payments is the right thing for the customer and their financial circumstances. Removing the need for affordability assessments has greatly streamlined the process for all involved and will make access to lifetime mortgages more straightforward for more people.
“This is another exciting step forward for Retirement Advantage and for the equity release industry, at a time when it continues to grow and appeal to over-55s taking a more holistic approach to their retirement planning.”
The modified product features apply to Retirement Advantage’s interest select options, where customers can choose to pay some or all of the interest each month. Their lump sum and voluntary select options remain unchanged.