Mortgage advisers need to focus on establishing later life lending referral relationships as confidence in the equity release market continues to grow, says Key Partnerships.
Data for the first half of the year shows total lending hit £1.171 billion, with the second quarter of the year showing an increase in lending on the previous quarter.
The number of new customers rose by 9% in the second quarter compared with the first quarter.
Key Partnerships, the referral and partnerships business of Key Group, said nearly two out of five (37%) brokers expect inquiries to rise in the rest of the year with 35% predicting a rise in applications and 37% anticipating an increase in completions.
As such, the firm believes there is a greater need for brokers, as well as advisers and wealth managers, to expand their offering to include access to later life lending solutions either through establishing an expert referral partnership or by developing their own later life lending advice capability.
Damon O’Connell, director at Key Partnerships, said: “Growing confidence in the equity release market as demonstrated by the increase in lending and customers in the second quarter of the year shows why specialist expertise is increasingly important while also highlighting a significant commercial opportunity for adviser firms.”
O’Connell said later life lending can be complex and nuanced which means firms advising on it need to be able to provide genuinely independent, whole-of-market advice.
“Working with an established referral partner can help reduce risk, ensure consistent standards and provide a relatively quick route to expanding a firm’s offering. Combined with the opportunity to generate referral income, this can make referral partnerships an attractive option for many firms.
“That will enable firms who are not expert in the sector to deliver good customer outcomes aligned with Consumer Duty obligations while also developing their own business.”
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