The discussion around whether to introduce a standalone equity release qualification shows just how complex the advice landscape has become. The concern is that advisers are not considering equity release products due to the current qualifications being more linked to mortgage advice. There is a real fear of failure to satisfy the regulator and ombudsman.
However, I consider the suggestion of a standalone qualification to be obtuse. At least the FCA had the common sense to avoid endorsing the idea, only raising the question.
For me, this issue sits at the fulcrum of who is regulated. Core under both the existing and potential new senior managers and certification regime is that it is the firm and its principals that is regulated and holds the permission to trade. The individual adviser is just part of the firm, judged by it to be fit and proper.
This means it is up to the leaders of firms to decide what types of business they want to transact and ensure their people are properly qualified. Cherry picking equity release without full consideration of other options available sits with the firm, not with individual advisers, no matter how skillful.
The development of hybrid products that allow servicing and interest roll-up needs a wider knowledge, advice and permission than offered by this proposed add on. Can you see the concept being extended to develop a simple qualification to allow mortgage advisers to deliver annuities for their clients? I do not believe that would make its way into the regulatory regime.
There are over 8,000 advisers with the equity release and mortgage qualification. Firms active in the sector do not suffer from a lack of capacity or recruitment issues. It is the lack of proper consumer engagement, signposting and appropriate referral and commercial agreements between firms that hampers the market. Consumers deserve proper advice on pensions, investments, mortgages and equity release from respective specialists.
Robert Sinclair is chief executive at the Association of Mortgage Intermediaries