I have known Andrea Rozario (former director general of the Equity Release Council) for a long time and always had the utmost respect for her passion for equity release. She has a deep and personal experience of overcoming objections often from elderly consumers and has been closely involved in the associated reengineering of the equity release product so that the issues of negative equity, roll up of payments and product construction and the like, are addressed and really well explained to often vulnerable customers.
The £1.4bn of equity release loaned in 2014 shows that we are at the beginnings of a very important journey. With L&G entering the market it seems to me at least that we are close to a tipping point.
Let’s face it; the indisputable facts are that those aged over 55 hold most of the untapped equity in Britain’s homes. Unlocking this will be crucial to tackling the issues of funding retirement and long term care costs as well as the issues of home ownership for younger generations. So when Andrea, an expert with decades of experience criticises Which? for their comments about equity release products, it is at least worth a listen.
I am sure you are all familiar with the various types of reports that Which? produce in which they review and offer guidance about products. I remember my parents read their reports to find out how to use their laptops and tablets; a field in which they excel.
The big difference of course is that they do not try to directly sell you a tablet or a washing machine after you have read their report. If you wanted to buy the product you would go to the nearest retailer to buy the product or purchase it online. However, Which? has a small brokerage selling mortgages to consumers, and it seems to me at least a possible conflict of interest.
This highlights three things for me. The equity release market is a complex and sensitive one. The need therefore for expert, independent advice, sensitively given, is key. Finally Which? has built a brilliant brand based on objective independence delivered with clarity in language consumers understand – it would seem folly to risk that with the perception of bias or conflict.
Nigel Stockton is financial services director at Countrywide