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Nationwide says big firms won’t enter equity release for three years

Nationwide is warning hat it might take another three years before the major lenders launch full-scale equity- release products.

Chief executive Philip Williamson says he is concerned that Nationwide could become embroiled in a missell-ing scandal if it enters the market too soon.

He fears that consumers could complain to the Financial Ombudsman Service that they did not understand the advice given and says the solution could be to insist that customers should get written confirmation from a solicitor that they have understood the advice.

HSBC, NatWest and Royal Bank of Scotland have all dipped their toes into the market.

Despite Nationwide’s fears, the FOS says complaints about equity release are still low.

Williamson says: “We are seriously thinking about equity release but we do not want to get caught up in five years in what has happened with endowments.

“None of the five biggest lenders has gone in full pelt. We are all a little fearful that a straightforward mortgage proposition might be challenged by the regulator or by customers who do not understand the advice.

“There is great demand but it might take three years before the big lenders enter the market.”

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