According to a report from Standard Life Home Finance, which surveyed around 500 over-55 homeowners considering later life lending, it was found that 34 per cent relied on information from family and friends.
Around 35 per cent requested guides from various companies, and just 14 per cent went to see a financial adviser without collating information beforehand.
The lender said this highlighted how people made decisions about later life lending, but that this could exacerbate certain misconceptions of the sector.
Standard Life Home Finance found that ahead of speaking to an adviser, 40 per cent thought equity release wasn’t right for everyone but could help in certain instances.
Around 29 per cent said they thought interest could build up and you can owe a lot more than originally borrowed and 28 per cent said they considered it a product of last resort, but more people were using it.
The report noted that 22 per cent thought it could stop you from leaving an inheritance, and 15 per cent thought they could end up owing more than the value of their home. Around eight per cent thought they could pass debt on to their family.
Just under half, 40 per cent, felt it was a good way to access equity in the home.
However, nearly all those surveyed, 97 per cent, said they understood equity release after speaking to an adviser, with 61 per cent of people saying the consultation gave them a clearer idea of their options.
Over half, 58 per cent, said they felt more optimistic after speaking to an adviser, highlighting the key role they play in the space.
Kay Westgarth, head of sales at Standard Life Home Finance, said with more people considering equity release it was good to see they were “keen to develop an understanding of their options” before speaking to an adviser, but specialist advice was key.
She added: “Specialist advice is vital to help people to make the right choices for their individual circumstances now and in the future, but an informed customer is an engaged customer who has genuinely started to think carefully about their options.
“That said, certain misconceptions and concerns can arise when information-gathering or conducting independent research, which may need the support of a specialist to unpick. For example, equity release products have evolved and developed significantly over the last five years and many people may not realise that those who take out a product with Standard Life Home Finance receive downsizing protection as standard.”
Westgarth continued that highlighting product features such as the no negative equity guarantee, the ability to make interest payments and the availability of inheritance protection could lessen customer concern.
“The difference in customer attitudes before and after having a consultation with a financial adviser clearly shows the true value of advice,” she noted.
