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FCA shelves plans for equity release qualification

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  • 09/05/2017
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FCA shelves plans for equity release qualification
The Financial Conduct Authority (FCA) has decided not to press ahead with a standalone or top-up equity release qualification.

Responding to its consultation on appropriate qualification exam standards, it noted that industry comments were mixed and suggested a move to do so would reduce access to the market for consumers.

“The responses we received did not demonstrate a market need for a change to the appropriate qualification for equity release,” the regulator said.

“We note that respondents had a range of views on the relative merits of a standalone versus top-up approach. These centred on two themes: the desirability of holistic retirement advice and the ongoing need for mortgage content in an equity release qualification.

“We also note that some firms would like to deliver holistic retirement advice but were mixed in their views on how to achieve this. We recognise that a solid understanding of mortgages is, and is likely to remain, an important competency in giving equity release advice,” it added.

The FCA also highlighted that if it considered this matter again it would take the views received in this consultation into account.

 

Mortgage knowledge essential

Overall 18 responses from lenders, intermediaries and their trade bodies as well as qualification providers were received on the equity release qualification.

The regulator summarised the comments it received, with several pointing out that comprehensive knowledge about mortgages was necessary and so the current qualification was appropriate.

This was because of the nature of lifetime mortgages as the main source of equity release.

It was also argued that a pensions and investment adviser with an equity release top-up qualification may not consider a standard mortgage, where this may be the most appropriate product.

The full response from the FCA is available on the regulator’s website.

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