The consultation, CP16/24, also proposes the additional option of allowing advisers to top up existing pensions or investment qualifications, which a straw poll of advisers voted against at the Financial Services Expo in London today.
The FCA said that any alternative would continue to have substantial mortgage content, as the vast majority of the equity release market is loans-based.
Feedback to the regulator suggests that the current qualification structure is preventing many consumes from being able to access products, with some stakeholders suggesting that some IFAs may not be offering equity release due to the need to be qualified for mortgage advice beforehand.
Stuart Wilson, channel marketing director, More 2 Life, said as the market evolved from a niche to specialist advice market, more advisers were needed to support growth of retirement lending.
“We have both the supply and demand for equity release, but not the adviser numbers needed to support the tripling of the market size, which is what we expect to happen by 2020 with lifetime mortgages hitting the £5 billion barrier.
“The lifetime mortgages market is on the cusp of a breakthrough with more funding and lenders entering the market space but we need the advisers to help us support this surge.”
Lending into retirement has become increasingly prolific since the Mortgage Market Review imposed strict affordability rules, leaving certain customers underserved by mainstream lenders.
According to a recent Mortgage Solutions poll, over half of broker respondents named equity release as the sector they were most keen to launch into.
At the time, Adrian Anderson, director of Anderson Harris, which had recently branched into equity release, said: “The principle of an equity release loan is quite simple so mortgage advisers may not find it that challenging to get up to speed.”
Comments on the FCA’s consultation must be submitted by 13 December 2016.
