The FSA has been criticised for failing to understand the market, with its Mortgage Market Review (MMR) proposals on equity release deemed “wholly inadequate”.
The regulator has proposed that equity release advisers will only be expected to disclose the scope of the service they offer in each sector.
While the majority of Mortgage Solutions readers thought the FSA should have gone further, 25% believed the FSA had got its proposals right.
Robert Brennan, director of The Right Equity Release, said: “Part of the problem with the industry is that there is a lack of education, not only on the consumer side but with advisers too.
“If brokers can provide clients with good, accurate and helpful advice, then they should be able to advise them on equity release products.”
Brennan said that the FSA should regulate the sector further to improve consumer confidence in the market.
“The FSA needs to go back to basics and explain to consumers that equity release is a good option for borrowers who are house rich but cash poor. It needs to get rid of the stigma attached to equity release and home reversion models, created during the darker days when they were not regulated,” he said.
Brennan suggested that the only way the sector can move forward is by making sure that advisers meet a minimum standard of good knowledge of the sector, so they can offer the best advice possible to their clients.
For next year, he forecast that the sector will see a gradual increase, with more companies set out to strengthen their marketing tools to help boost the equity release market.
