Equity Release Council Update Legal Advice Requirements
Equity release providers are no longer expected to ensure customers receive face to face legal advice before taking out an equity release product.
The Equity Release Council published the temporary modification to enable those in need of accessing equity release finance to do so without creating additional barriers and delays.
The Council has stated that, as a temporary measure, it will enable legal advisers to fulfil their due diligence and offer legal advice without meeting clients in person.
Legal advisers can now complete the following tasks via a video conference:
- identify clients identity
- identify client mental capacity to ensure they are able to enter an equity release contract
- ensure the client is not under duress or coercion to enter the contract
- where there is more than one party entering the contract, ensure that both agree
The legal requirement to meet face to face will be reinstated once restrictions on movement are lifted.
David Burrowes, Chairman of the Equity Release Council, comments:
“These are unprecedented times and the Council is pleased to have secured industry support for a solution that ensures consumers can continue to access quality, independent legal advice when considering whether to release equity from their homes.
“The new measures have been designed with input from expert solicitors who provide legal advice on equity release transaction across the UK. It is designed to support large and small solicitors to advise safely on equity release at this time.
“This unique and temporary solution is the result of collaboration and sharing of legal expertise among Council members in challenging circumstances, to ensure consumers’ interests remain protected. The Council will keep this modification under close review until it ceases, when the Government ends its ‘stay at home’ requirement.
“The process has also reaffirmed the value of the ‘gold standard’ face-to-face requirement for independent legal advice which is retained to use if and when Government guidelines allow.
“Property wealth plays an increasingly important role in later life planning, and these measures to maintain access to equity release legal advice for older consumers will continue to ensure it is chosen for the right reasons, as part of a carefully considered process that looks at both short- and long-term needs.”