The product will be added to its existing offering of life interest, cash release and exchange deals and will be introduced in the next three to four months.
Economic Lifestyle’s lifetime product is set to boast competitive rates, has a flexible drawdown option and a minimal, if any, application fee.
Mark Neal, managing director of Economic Lifestyle, said: “Our products are aimed at offering people flexibility and affordability to help them to get the right product to suit their needs. While most equity release companies focus on higher end clients, our focus is based on the lower end of the market and we believe it is important to offer these people a choice which works for them, whatever they want to do.”
The firm believed intermediaries play an increasingly important part in all aspects of the equity release market and it advises clients to seek out an IFA to help them make best use of the cash made available through the product.
However, it also believed the market was being frustrated by the lack of specialist intermediaries who deal in equity release.
Neal commented: “It is important to work with IFAs as 95 per cent of the clients have no links to financial planners. We know it can be difficult for IFAs in this market and there are very few specialists in an area with huge potential.”
Kevin Morgan, managing director of Consilium Financial Planning, said: “If there isn’t a specific need to release money then we wouldn’t advise on equity release and offer a drawdown policy so there isn’t sackloads of cash sitting in a bank account.
“Equity release still has an image problem but this should not be a reason for brokers not to do it. We are in a transition period now but in around five years time, it will be seen as the norm.”
