Despite the challenging market conditions following the 2022 mini-budget, 82% of surveyed advisers found that clients continue to look for low interest rates in a lifetime mortgage, according to research by Pure Retirement facilitated by Smart Money People.
Conducted with over 160 advisers as an exercise in better understanding their current experience in the later life lending sector, the research also saw advisers claim that their clients ask about the ability to optionally repay monthly interest (41% of questioned advisers), the no negative equity guarantee (39%) and downsizing protection (24%).
When asked what motivated them to refer a particular lender (excluding interest rates), advisers themselves reported that they look for lenders offering good customer support (51%), while 46% of those surveyed also indicated the importance on recommending lenders that are seen to be reliable and trustworthy. Additionally, 37% of surveyed advisers claimed to recommend lenders based on their innovative products.
Nonetheless, two-thirds (66%) of surveyed advisers said that client misunderstandings remained the biggest challenge they face when advising on equity release. When asked what type of educational resources would ease that challenge, 58% cited printed guides, 36% pointed to more TV visibility, while 34% suggested the answer could lie in videos, and 33% looking to a greater industry press presence.
Speaking of the findings, Head of Distribution Scott Burman said: “These findings demonstrate how importantly consumers continue to view rates, even amid the challenges being faced in the wider economic landscape for lenders. Additionally, they show encouraging levels of understanding of the product, with nearly four in ten advisers reporting being questioned about the no negative equity guarantee.
However, those same advisers also highlight the lack of client understanding being a major challenge to overcome when advising, showing the fact that despite the increasing mainstream appeal of lifetime mortgages we’ve still got work to do as an industry to widen that comprehension through a variety of different channels. Additionally, the findings serve to underline the importance that advisers place on customer service and reputation, highlighting the extent to which they value the peace of mind in placing their clients in safe hands, and how vital it is to maintain a customer-first mentality across the sector.”
