As such, talk has once again turned to the need for a Financial Conduct Authority (FCA)-approved standalone equity release qualification for advisers.
Last year the regulator shelved plans to launch a qualification that would allow financial advisers without mortgage permissions to advise on equity release plans.
The decision was met with criticism. Financial advisers who didn’t offer mortgages but wanted to add equity release to their arsenal argued it was a pointless exercise to become qualified in selling a product they had no interest in selling to offer a different product they did. And one can see their point.
Becoming qualified to sell mortgages – up to the necessary level three, required to sell equity release – is not an easy task. It takes time and study that does seem wasted effort if the adviser has no desire to offer 95% of what they’re learning about.
Education, education, education
However, while I understand this point I take a different view. In recent years the mortgage world has become more joined up. The FCA regulation of consumer credit in 2016 has brought second charge finance firmly in line with firsts, and few would argue that this hasn’t benefited all involved.
Equity release is closely aligned with mortgages and should fall within a mortgage brokers remit. It is fast becoming an essential product for many homeowners. Property, finance, and equity are intrinsically linked. Creating an avenue for advisers outside of the mortgage world would segregate the product in a way I don’t think would be helpful.
And customers run the risk of losing out. Products that are more suitable for a borrower may be overlooked by an adviser if the focus is purely on one option.
A cohesive joined up approach is much more beneficial to clients.
Perhaps in this instance being a master of one trade is not the best option.