Nigel Waterson, comments on recent news about Santander

Nigel Waterson, Chairman of the Equity Release Council comments on the news that Santander is considering offering ‘lifetime mortgages’ in 2015:

 

“We welcome any new entrants to the market that provide consumers with more choice and flexibilities on the proviso that the existing high standards of advice and safeguards in the sector are upheld. We would urge all banks and other lenders looking to offer lifetime mortgages to join the Equity Release Council, sign up to the industry Code of Conduct and give customers the assurances that they will retain the right to tenure and never owe more than the value of their homes.

 

“It is important to remember that ‘lifetime mortgages’ have an established regulatory definition, and that Equity Release Council members sign up to a range of consumer safeguards. A number of products offer the consumer the option of paying interest as they go along, and switching to the rolling up of interest to be paid when the property is sold (the normal model).  But we would have concerns about a model which required interest payments, the non-payment of which could mean people losing their home.

 

“All equity release customers who use a provider member of The Council receive both independent financial and legal advice so they fully understand all obligations associated with a lifetime mortgage. This is vital to give them the confidence that their chosen product is appropriate and suitable for their needs.

 

“The latest lending figures* show that equity release is increasingly popular as cash-strapped retirees look to boost their incomes in the face of poor savings returns and dwindling pension pots. It is great to see interest from the likes of Santander and may spark moves from other banks to increase consumer choice within the market.

 

“We would urge anyone considering equity release to speak to an independent financial adviser who is best served to discuss all the options available. We’d always recommend that customers discuss their decision with those closest to them so that family are aware and accepting of their choice.”

 

-ENDS-

*The Council’s Q3 2014 results found that lending totalled £375.5m – the largest amount in any single quarter since records began in 2002.


For further information, please contact:

  • Andy Lane, Victoria Heslop or Sam Fisk at The Wriglesworth Consultancy, on 020 7427 1400 or email: [email protected]