Advice on equity release is very widely described as compulsory. The FCA rules are more precise: the firm gives advice, and you have the right to reject it and proceed execution-only, losing the suitability protections in the process. This sets out what the adviser has to test, what they must tell you, and what they have to put in writing.
An adviser has to test whether the plan suits you, tell you the test is a snapshot, and put things in writing if you overrule them. Here is what that means on the day.
Equity release may involve a lifetime mortgage, secured against your property, or a home reversion plan. It will reduce the value of your estate and impact funding long-term care.
It is widely written that advice is compulsory before equity release. The FCA rules are more precise than that, and the difference matters to you. A firm selling an equity release transaction gives advice, and you have the right to reject that advice and proceed on an execution-only basis instead.
What you give up by refusing is not vague. The firm has to tell you in writing that you will not benefit from the protection of the rules on assessing suitability, and you have to confirm in writing that you are aware of the consequences of losing those protections. That is a real trade, and it is the reason almost nobody makes it.
MCOB 8.6A.2R says a firm "must not encourage a customer to reject advice received". If anybody suggests skipping the advice to move faster or to save a fee, that is the rule they are working against.
How to check the person you are talking to →The adviser collects your circumstances. Ages, the property, what you owe, what you are trying to pay for, who else lives there and what you want to leave behind. The more accurate this is, the more the suitability test is worth.
Documents to find first →They test whether the transaction is suitable for you, which the rules define as appropriate to your needs and circumstances. Expect to be asked about alternatives, and expect to be asked what happens if your circumstances change.
Questions worth asking →An illustration setting out the plan in figures, and a written explanation of the basis on which the advice was given. Read the illustration before you decide anything.
How to read an illustration →Independent legal advice from your own solicitor, which the Equity Release Council requires of every customer. That is a different appointment with a different person, and it is not the adviser.
What the solicitor does →It is a defined test rather than an opinion. Where a firm gives advice to enter into an equity release transaction, it must take reasonable steps to ensure that the transaction is suitable for that customer, and suitability is judged on whether it is appropriate to the needs and circumstances of the customer, on the facts disclosed and the facts otherwise known.
Two consequences follow, and both are practical rather than technical.
This is the least known rule on the page and the most useful. If the adviser tells you that alternative methods of raising funds are more suitable and you reject that conclusion, they may still advise on the equity release transaction. But they must then confirm to you, in a durable medium, the basis on which the advice has been given.
In plain terms: you can overrule an adviser, and if you do, you get their reasoning in writing. Keep that document. It is the clearest record of what you were told and why, and it costs nothing to ask for.
It is not an application, and agreeing to nothing on the day is a normal outcome. It is not a valuation of your property, which happens later and is a separate judgement made by somebody who has seen the house.
It is also not legal advice. The solicitor stage exists precisely because the adviser cannot do that part, and the Council requires it of everyone.
What is suitable for you. That is a judgement about your circumstances made by a qualified adviser who has taken them down, and this page is a description of the process and the rules that govern it. We are not advisers, we do not know your circumstances, and nothing here is a recommendation to proceed.
Equity release may involve a lifetime mortgage, secured against your property, or a home reversion plan. It will reduce the value of your estate and impact funding long-term care.
None of this needs an adviser to obtain, and having it turns a first meeting into a useful one.
Questions worth putting to the adviser in the meeting itself.
What alternatives did you consider, and why did you rule them out?
Alternatives are part of the suitability test. A clear answer names them; a vague one is worth pressing.
What would change your recommendation?
The assessment is based on your circumstances now. Asking what would move it tells you how finely balanced it is.
What are you paid, by whom, and when?
An advice fee and a lender commission are different things. Ask for both.
Will you put the basis of this advice in writing?
If you have rejected a conclusion about alternatives the rules require it. Either way it is a reasonable thing to ask for.
What happens next, and what is the earliest I would have to decide anything?
A good answer describes a sequence. There is no reason for a decision in the meeting.
Short answers to the things that come up most. None of it is advice, and every figure on this page carries its source.
Not strictly. The FCA rules work as an opt-out: the firm gives advice, and you have the right to reject it and proceed on an execution-only basis. If you do, the firm must tell you in writing that you will not benefit from the protection of the rules on assessing suitability, and you must confirm in writing that you are aware of the consequences of losing those protections.
Suitability. Where a firm advises a customer to enter into an equity release transaction it must take reasonable steps to ensure the transaction is suitable for that customer, and the rules define that as appropriate to the needs and circumstances of the customer, based on the facts disclosed and the facts otherwise known. The adviser must also explain that the assessment rests on your current circumstances, which may change.
You may reject their conclusion and they may still advise on the equity release transaction, but they must then confirm to you, in a durable medium, the basis on which the advice has been given. In practice that means you can overrule an adviser and you get their reasoning in writing. It is worth keeping.
No, they are separate and they happen with different people. The Equity Release Council publishes that all customers who take out equity release need to receive independent legal advice, and that the solicitor talks you through the plan and then asks you to sign a certificate confirming your rights and obligations have been explained to you.
No. An advice meeting is not an application, and leaving without agreeing to anything is an ordinary outcome. If anybody presses you to commit in the meeting, note that the FCA rules say a firm must not encourage a customer to reject advice received, and that a decision this size does not need to be made at a first appointment.
Equity release may involve a lifetime mortgage, secured against your property, or a home reversion plan. It will reduce the value of your estate and impact funding long-term care.
One qualified equity release adviser. They will go through your figures and tell you if there is a better answer. It costs nothing and commits you to nothing.
Google Analytics, Microsoft Clarity and Vimeo. Say no and none of them loads. What each one stores, and what Microsoft use theirs for.