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Mortgage advice qualifications to be modernised to support later-life lending

  • 11/09/2019
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Mortgage advice qualifications to be modernised to support later-life lending
An overhaul of the mortgage advice qualifications is being undertaken with trade bodies across the industry working to bring the move together.


Mortgage Solutions understands that there has been an acceptance across the market that the existing qualifications do not adequately prepare advisers for the market in its present state.

The issue of the two separate regulatory regimes, which divide brokers that have completed only the mortgage advice qualification and those with the lifetime mortgage qualification, has been a significant and growing concern as the later-life lending market has developed.

It appears the Financial Conduct Authority (FCA) is unlikely to change its overall rules but there is an understanding that the exams can be updated to reflect market evolution.


Not as deep or robust

Association of Mortgage Intermediaries (AMI) chief executive Robert Sinclair (pictured) told Mortgage Solutions that the change was necessary and overdue.

“There appears to be recognition across the market that the existing qualifications in both pure mortgage and equity release markets are not as deep or robust as responsive market participants would want them to be,” he said.

“The evolution of equity release products and retirement interest-only (RIO) together with pension freedoms means that there needs to be a review of the existing qualifications not withstanding that the regulator might not be changing the architecture.

“I believe the professional bodies will step up to the plate and make the changes necessary,” he added.


Not fit for modern purpose

The Equity Release Council (ERC) has also been involved in the pan-industry discussions and will be tying its work in with an updated competency framework.

ERC chairman David Burrowes told Mortgage Solutions an update on these subjects was expected to be published in November.

“There’s been really great collaboration across the industry and we’re looking to take that to next step,” he said.

“There is an agreement to broaden the qualifications to be fit for all later life with good progress being made.”

Burrows added that it was seeking to deal with the issue of old dusty qualifications that are not fit for modern purpose and to help new advisers who want to get into the industry and get breadth of understanding.

“It will be linked to our competency framework which will make sure they understand the complexity of the market and whether to advise the client or signpost to somewhere else.

“To know what they don’t know,” he added.


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