Advice on Equity Release mortgages is the most important part of the process. If you are looking to release some of the funds from the value of your property then obtaining the right advice is fundamental to the process running smoothly and receiving the correct advice for your circumstances.
There are a number of considerations to obtain the best advice on Equity Release mortgages. Here we examine the main ones:
Do I need advice?
There are approximately ten Equity Release lenders on the market. The majority of these do not lend directly to the general public and instead insist that potential clients obtain Equity Release advice from a qualified professional. This could be an Independent Financial Advisor or Mortgage Advisor who has gained the correct qualification or an Equity Release advisor who specializes in giving advice in this area. There are pros and cons to both types of advisor. A specialist Equity Release advisor may have good knowledge on the products and lenders, however they may not consider the other alternative lending products that a Whole of Market IFA or Mortgage broker can consider.
How do I find good advice?
The best way to find the best advice on equity release mortgages is from a friend or family member who has recently taken advice on their options. The chances are that if the were happy with the quality of the advice they received, you are going to get a similar quality of advice.
However, many people are reluctant to tell friends and family about taking out equity release advice so this option may not be open to many.
Another way to obtain professional advice is to go to the Equity Release Council’s (ERC) website and find an advisor who either lives locally to you, or one that you have heard of that you want to research.
The ERC is the industry body for the equity release sector and as its main role ensure that the interests of homeowners are safeguarded. This makes it an excellent place to start to find an advisor who will give you good advice.
Advisors often have websites and review pages where their previous clients have left comments and scores regarding their experience of the service they received. As with most aspects of our lives now, this does make it easier to research which advisors have given good service in the past and are therefore likely to give you good service.
What should I ask when I first contact an advisor?
When you have found an advisor, or advisors, that you would like to consider taking advice from, there are several important questions you should ask them. Once you have the answer to these questions, then take time to consider the answers you receive and proceed at your own pace. If an advisor calls, emails or sends letters to you too often, then this is not great service.
A good advisor (or firm) will answer your questions, signpost where you can read more information and then allow you time and space to make your own decision and return to them when you are ready. You should expect three or four appointments with the advisor before you go ahead. If you are feeling rushed at any point, stop. This is a major financial decision and you are in control.
What initial questions should I ask?
When seeking advice on equity release mortgages, there are many questions you could ask. Three of the most important are:
- Do you source deals from the whole of market, or are you restricted to certain lenders?
- Can you tell me your fee structure and when are fees payable?
- If I want some initial information from you, are you prepared to give me the information I need and then wait until I come back to you to ask questions?
Once you have asked these three questions, you will have a good idea of the range, cost and type of equity release advice on offer. By asking these questions you will be able to discover if you warm to the advisor…believe it or not this is fundamental to the relationship. In the industry, many advisors use the same sourcing systems and can access similar products. The trust and your views on how the advisor will look after you and guide you through the process will be fundamental to your experience of equity release and is built in these initial conversations.
Check out our last Blog post: Who does equity release mortgages?
Look out for our next Blog post: Can you do equity release with a mortgage?