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Broker equity release credentials disputed

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Australian Broker | 22 Feb 2011, 05:30 AM Agree 0
Equity release body SEQUAL and the Financial Planning Association are at odds over whether finance brokers should advise on equity release transactions
  • Twiggy | 22 Feb 2011, 03:14 PM Agree 0
    I fully support Kevin Conlon in his comments.
    In researching the FPA's previous policies concerning Equity Release/ Reverse Mortgages, it is seen FPA has never wanted to be part of this market - reference its submission to the Productivity Commission on "Caring For Older Australians".
    An Equity Release client was recently unaware that financial advice was not mandatory and went seeking assistance from financial advisers with the following results.
    a) not interested
    b) not interested
    c) not interested
    d) a plan will cost $800
    e) adviser needs a special licence from ASIC to advise on Equity Release.
    It is my belief the FPA is only now interested in Equity Release in line with the new "fee-for-service" model of 2012. The FPA charged its members $500 to attnd a SEQUAL accreditation course and most of the $500 went to the FPA, with very few FPA members attending the course.
    Perhaps Dante De Gori would be interested to know there are some advisers who "double-dip" with Equity Release clients, particularly for those entering aged care - they receive a commission on the mortgage and then charge for the plan. Not much independence there.
    Paul Dwyer
    Melbourne and Peninsula Reverse Mortgages
  • countrybroker | 22 Feb 2011, 03:14 PM Agree 0
    The FPA are beyond a joke. I do reverse mortgage and had to do numerous courses and on line training to become accredited to do them . I am also affliated with a financial planning group, and they want nothing to do with the applications for a reverse mortgage , their attitude is we will leave it to you so our clients get impartial professional service , they still give advice on taking the reverse mortgage , but do not want to be involved in the deal or application. I DO NOT charge a fee , a financial planner will in most cases charge the client despite getting an up front and trailer, the planners I deal with do not want a fee from me, and they charge a modest fee for advising their clients , shame on the FPA.
  • ReversePeter | 22 Feb 2011, 03:18 PM Agree 0
    As a long term, active reverse mortgage broker, it would be refreshing to see a Financial Planner who viewed the RM product as anything other than a way to access funds for their client to purchase investment in 'their' managed funds etc etc. The overwhelming majority of my RM clients were clearly NOT in need of (nor could they afford) a 'Finacial Plan' - rather they were seeking an option to sustain a reasonable life-style in their retirement years. Sadly, in too many instances, a Reverse Mortgage is thier ONLY option to do so.
    In most instances, it is NOT a 'complex' product, regardless of how stridently the Financial Planner sector try to proclaim it as such. However it is a necesaary product for a significant proportion of senior Australians. I fear for the availability of the product, should the Financial Planners get their hands on it!
  • Jeff Mazzini AAMC Training Group | 22 Feb 2011, 05:57 PM Agree 0
    Reverse mortgage lending can or may trigger other issues such as having an effect on a persons pension payments and hence some middle ground needs to be achieved here. Reverse Mortgage lending goes beyond just providing a loan and hence its timely that the regulator make a determination on the required qualifications to give such advice in this area. Could it be a limited advice model with required qualifications, then that may be suitable to all parties concerned. Having been a broker and a planner in my past life and having been involved in the process of a reverse mortgage, there certainly are other issues to be considered besides just the loan being approved. This debate has been around for some time now and its timely to make the required outcomes clear to all concerned.
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