Equity Release – not just a crisis product

Despite greater financial regulation and significant improvements in the industry a significant portion of the population still have negative perceptions about equity release. Perceptions of equity release need to change from it being seen as a "product of last resort" to it being a normalised consideration in the retirement planning process.

The Daily Telegraph recently reported that pensioners who snapped up property back in the 1970's could be sitting on a staggering return of investment of more than 1000 percent.  With pension annuity rates falling and today's difficult economic climate limiting other sources of income, many over 55's could stand to benefit from cashing in on this wealth. Equity release allows access to property wealth without the hassle of selling up and relocating, and recent product innovation has created a wider range of equity release options and stimulated competition in the market.

 Despite this, recent research from the Equity Release Council found despite a third of people saying they'd consider using their home to fund their retirement, only six percent would consider an equity release product. The industry has worked hard to shake off any negative reputation it had and the equity release community needs to communicate this to customers.

 It is also crucial we improve the availability of equity release information. Membership bodies such as ERSA and The Equity Release Council can help to achieve this, creating recognisable entities that provide assurance of safe and regulated products.

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