The industry regulator, the Financial Services Authority (FSA) has been criticised for not imposing regulation on Equity Release schemes or second mortgages.
From 2004 mortgages and mortgage advice will fall under the scope of the FSA and will be subject to stringent regulation. However, the FSA said that although they would not regulate Equity Release products or second charge mortgages, they would still come under the scrutiny of the Office of Fair Trading and Consumer Credit Act.
By regulating mortgages advisers will be bound to give fair treatment to consumers, including clear information, fair advertising and advice to make sure the mortgage is suitable and affordable. This has been happening under a voluntary code of practice but from 2004 it all becomes official.
For a copy of our fact sheet on releasing equity from your home contact us.