Seniors equity release market industry body Sequal has raised the idea of a system of financial counsellors to provide reverse mortgage (RM) specific advice to consumers.
A network of financial councillors, based on a current system in the US, could be used to fill a current gap in RM information currently available to consumers, according to Sequal chief executive Kevin Conlon.
He said Sequal research showed that consumers are “reluctant to seek financial advice on the basis that a financial planner has to consider their full circumstances and it usually involves development of a full advice plan”.
“There appears to be a gap in the market between full financial advice and the limited advice that (research shows) consumers seek around these RM transactions.”
Sequal research shows that Australians “do not consider the actual RM transaction to be complex but do consider complex the impact of the transaction now and into the future”, Conlon said.
Currently, Financial Information Service officers that are part of Centrelink do an “excellent job of providing advice to RM customers on the impact of the transactions on their ‘benefits entitlements’”.
However, there also appears to be a need for information on the impact on inheritance ambition and retirement needs, particularly aged care.
