Understand Equity Release Scams

As with any financial scheme or plan, equity release has sometimes been mis-sold in the past by lenders who were less than reputable.

Do Equity Release Schemes Fall Under the Financial Ombudsman?

The Financial Ombudsman Service deals with equity release mis-selling cases regularly. Follow the guidance of the Equity Release Council to find a safe lender who offers a 'no negative equity' guarantee.

Read on to find out what the common complaints about equity release are, and how you can easily avoid these issues.

Looking for other information on Equity Release? This guide has info on 'Can equity release be mis-sold?' We have also writen extensively about:

• - Are equity release rates falling?
• - Are equity release schemes a good idea?
• - Is equity release a good or bad thing?
• - Can equity release be paid off early?

We update all our guides regularly. If you are researching Equity Release and we haven't got an exact guide that helps you, keep coming back as we update daily.

Equity Release: The Most Common Mis-Selling Complaints

Equity release loans are only available to anyone aged 55 and over, and then later in life that you take an equity release loan, the more money you can get. However, with upper age limits sometimes as high as 90 years old, it’s no surprise that the top complaint the Financial Ombudsman receives for equity release is that a loan was given to someone who was vulnerable and convinced to take equity release when they didn’t necessarily want it or it wasn’t the best for them.

Others have complained that they made clear they intended to downsize their property, or move home, but they were incorrectly told that equity release would allow them to do that, while other complaints also revolve around whether the early repayment charge has an exemption in the agreement that isn’t being adhered to by the lender.

When the Ombudsman investigates a lender or financial adviser, they’ll look at whether the advice of the Equity Release Council was followed, the formal advice given and the alternative options that were presented to the customer to help them get the money in a less expensive way.

Equity Release: How to Avoid Being Mis-Sold Equity Release

There are many ways to avoid being mis-sold equity release, and as long as you follow these guidelines it’s as safe as any other form of secured loan such as a mortgage. You should check that your financial adviser is registered with the Equity Release Council. You can run a quick check on their website.

If they aren’t, then avoid them, as it means they’re unlikely to be following the rules designed to protect the customer. If they are, then you should be absolutely fine. You just need to ensure that they provide fair and realistic advice and that they present you with a selection of options.

If they only tell you to go for equity release, or they only present one provider, then consider this a red flag and report them.

Equity Release: Protect Your Loved Ones

If you’re concerned for a loved one who is thinking of applying for equity release, agree to attend the adviser appointment with them, so you can offer an independent perspective and ensure they’re being looked after.

It’s best to make sure you’re as prepared as possible, which is why we’ve put together a wealth of information on equity release. Just take the time to browse our site and you’ll learn all about the interest rates, expected costs, pros, cons and time frames.

How Can Money Savings Advice Help You With Releasing Equity?

Here at Money Savings Advice, we have partnered with some of the UK’s leading Equity Release brokers. They have already helped thousands of people get the best Equity Release deal and they can do the same for you.

Choosing an independent adviser means they won’t recommend a scheme unless they are sure it is in your best interests. Their advice is also regulated by the FCA, which gives you an additional layer of protection.

If you would like to speak to one of these brokers who can provide you with a ‘whole market quote’ then click on the below and answer the very simple questions.