The aim is to help those firms considering entry to the market understand all aspects of the advice process, regulatory requirements and legal considerations.
The guidance covers both lifetime mortgages and home reversions, which come under the Financial Services Authority’s (FSA) jurisdiction in April.
Advisers currently working in the market can also use the guide as a useful cross-check to identify any areas that may have been overlooked. The guidance notes also feature a list of contacts and source of information.
Rob Griffiths, associate director of AMI, commented: “The equity release market is seen as high risk by the FSA as it believes there is a greater chance of consumer detriment if firms’ processes are not of the highest standard. The FSA has already conducted two reviews of the sector and in the last review we were pleased to see improving standards from broker firms. These notes have been designed to help firms further improve the quality of their advice.”
Peter Wright, financial adviser at CBK, said: “For advisers in the market and those looking to enter, this is an extremely useful tool that clearly sets out the best way to advise on equity release. For brokers already in the market it is a reassuring to know that if these procedures are in place, then we’re on the right track.”
