With the final rules from the Financial Services Authority published and the regulator accepting applications for authorisation, the clock is ticking with the deadline of April 6 2007 fast approaching.This is a good time to provide a reminder about the main issues surrounding home reversion regulation, and it’s also a good time to revisit advisers’ responsibilities when advising on lifetime mortgages. The reversion regulations follow the structure attributed to lifetime mortgages as much as possible. That said, there are a number of differences that will soon become evident to any provider offering both products, and certainly they will be obvious to those advising on both products. Where differences – or as some would say discrepancies – occur it is usually due to the fact that the Treasury and the FSA are clear in their view that home reversion is a higher risk transaction than a lifetime mortgage due to the fact that the client is giving up ownership of their home. In the lead-up to regulation I will take a look at some of the differences in the regulator’s approaches to the two product areas and look specifically at risk as-pects that differ from the lifetime mortgage regulations. One factor that will remain after regulation is the fact that advisers will be able to elect whether they advise on lifetime mortgages or home reversions only, or whether they advise on both products. This fact does not exempt an adviser from considering the alternative product as potentially more suitable just because they elect not to advise on it. The impact of this aspect of lifetime mortgage regulation has still not hit home, although it is clear from the FSA’s comments that it is looking at the quality of evidence documented to support recommendations where reversion may have been more suitable. In the months ahead there will be instances when advisers and providers question some of the home reversion rules as in some areas they are more onerous than those for lifetime mortgage. For now, this rests on an acceptance that a house sale is regarded in a different light.
- Top trends
Easier2move has forged a deal with retirementhome- search.co.uk to provide conveyancing services to its clients. The service will be white-labelled under the retirementhome- search.co.uk corporate umbrella.
Mark Blackwell has quit The Derbyshire after two and a half years as marketing director.Blackwell has ensured the successful launch of the society’s retail brand repositioning as well as being instrumental in the launch of ‘Salt’ the society’s specialist lending brand in 2005.Having also built a successful team around him, The Derbyshire punched well above […]
Access Broker Services the Secured Loan Specialists have launched an incentive scheme for new and existing intermediaries who introduce secured loan business. The prize includes all flights, transfers, accommodation, entrance tickets etc to the 2007 Masters Tournament in Augusta.Lawrence Ihle, managing director of Access, says: We wanted to reward our existing introducers and also to […]
The Office of Fair Trading has made a warning order against Darren Russell, the former proprietor of the estate agency and lettings business Homes Direct.Russell failed to disclose his personal interest in the acquisition of a property from a client, and his personal interest in the sale of his property to a purchaser. He thereby […]
With 23 auto-enrolment compliance notices issued by the Pensions Regulator, and an evolving legislative landscape meaning previously compliant schemes may now be in breach of regulation, now is the time to think about auditing your auto-enrolment scheme. Johnson Fleming is hosting a webinar on 9 October at 11:00 on how to audit your scheme to ensure compliance, avoid breaches and fines and overcome data issues.
News and expert analysis straight to your inboxSign up