Mortgage News
SERA urges FSA to increase protection in equity release
The Society of Equity Release Advisers (SERA) has urged the FSA to engage with it in order to improve standards of advice and ensure better consumer protection.
In its submission to the regulator’s proposals under the Mortgage Market Review, it has proposed a higher minimum qualification level for equity release advisers with a syllabus covering issues including trusts, wills and tax implications.
To reinforce consumer protection, SERA said firms must hold joint permissions for Home Reversions & Lifetime Mortgages in order to practice equity release.
It has also argued that intermediaries should provide a personalised suitability report which must be discussed with the client face to face prior to completion of an application.
Phone sales of equity release should be banned,according to the trade body. It believes face to face advice is the only way of adequately checking that the consumer possesses sufficient mental capacity to understand the risks.
Simon Chalk, chairman of SERA, explained: “This is particularly so in joint cases, where one party invariably speaks for the other. A further danger of telephone sales is the risk of one party being made to act under duress.”
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