SERA highlights need for face-to-face deals
02 February 2010
Selling equity release plans over the phone should be banned, according to one industry body.
Such programmes can provide homeowners with a financial boost by taking funds from the value of their property assets.
However, the Society of Equity Release Advisers (SERA) has said deals should only be conducted in a face-to-face environment in order to ensure customers have "sufficient mental capacity" to comprehend the deal.
The organisation said that in cases of joint ownership telephone communication would not allow firms to see if either of the parties was acting "under duress".
SERA's comment follows the publication of a Financial Services Authority (FSA) report, which proposed a number of regulations under its Mortgage Market Review.
However, SERA chairman Simon Chalk expressed concern at the lack of detail the review placed on the equity release market.
"We concur with [the] FSA's proposals in the main but remain concerned that equity release continues to be seen as a 'mortgage sale' and hasn't been recognised as a wholly different proposition, sharing more common features with financial planning products," he said.
"As the leading national body representing equity release advisers, we urge the FSA to engage with us in order to improve standards of advice, ensuring better consumer protection."