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FSA tells public to seek advice before releasing home equity

People buying equity-release products should always seek independent advice, says FSA mortgage supremo Sarah Wilson.

Head of high-street firms Wilson says when the FSA takes on its mortgage regulatory duties, there will be little reason for voluntary regulation bodies such as the MCCB and Gisc to continue.

In its final mortgage regulations published last week, the Treasury decided not to regulate equity release fully but the FSA believes because of risks with the product, consumers should seek advice before they invest.

The regulator has outlined its plans in CP146, The FSA&#39s Approach to Regulating Mortgage Sales. It proposes a special disclosure regime for equity release, providing more information to consumers and urging buyers to get advice.

Wilson says the FSA has concerns about areas such as buy to let and equity release but only while wearing its consumer education hat rather than its regulatory one because it was the Treasury&#39s decision not to regulate these areas fully.

Wilson says: “The future of the MCCB and Gisc is for their membership to decide. We acquire new responsibilities in the middle of 2004 which will take over much of what they do now. There will be much less reason for them to exist.”

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