Safe Home Income Plans chairman Jon King has responded to concerns raised by a mortgage broker over the fairness and simplicity of Norwich Union's equity-release mortgage.
Mortgage Portfolio Services principal Simon Chalk wrote to Ship a few weeks ago, asking it to review NU's membership after he and Charcol senior technical manager Ray Boulger criticised NU's product for having confusing early redemption penalties.
In a letter to Chalk, King says although the calculation of the redemption penalty can appear complicated, the presentation of the plan includes very clear illustrations of the likely impact in different situations.
King writes: “Norwich Union currently enjoys the position as the largest provider of equity-release products in the UK. A large proportion of this business is secured via professional intermediaries who are best placed to make recommendations to clients and to explain the working of any redemption penalties.”
But Chalk is not satisfied with the response. He says: “Mr King has kindly replied to my letter but unfortunately did not actually respond to the points that I raised. My issues centred on the fairness and simplicity of NU's plans. These are two basic requirements for eligibility to Ship membership and two points on which NU's plan fails.”