1. Keeping up with new product developments
It sounds obvious, but product amends and developments very often range beyond rate tweaks. Did you know that one drawdown provider now offers protected equity on its drawdown option?
For example, if someone has only used 50% of their facility, then 50% of their future property value only can be accessed to repay the loan. As they continue to drawdown, any unused percentage continues to be protected.
2. Ongoing development and adjustment to the sales process
It is essential that the advice process is revised regularly to reflect the makeup of products in the market.
Variances can be quite subtle, but may be important options or features for a client and the fact finding and research need to address these variances. A standard mortgage fact find will not do this.
Some of these subtleties may not be main advice triggers, but may be important features to some clients, but beware of selling red herrings that clients don’t really want but may be costly.
3. Identify main advice triggers
A core set of triggers for determining advice should be identified to help with product selection. Examples to identify may be: options to repay early or guarantee of access to further funds in the future.
Identifying a core set of triggers is essential in justifying product suitability. Once these are identified, the advice process leads from the client need against the triggers.
4. Health/lifestyle exploration
This is a major factor that can change the range of options for clients. This can include access to considerably higher LTVs and greater drawdown facilities.
Underwriting decisions from More2Life can be accessed in real time online giving instant decisions. Asking “are you in good health” will not be enough to identify eligibility. You must use 11 questions to identify eligibility.
5. The lowest cost option
It is a FSA requirement that, in establishing suitability, the recommendation should be the lowest cost option from same product types.
Not only should this be rate driven, but it should also drive suitability to drawdown products where the cost of borrowing can be heavily reduced. The sales process must be drawdown-centric.
