"Equity release is different to mainstream mortgage planning requiring different skill sets and the styles of advice in equity release and the mortgage market are very different"
The regulator said it also received "mixed feedback" on whether there was a market need, stating that "most respondents didn’t think that an alternative to the current approach would lead to a significant increase in the number of people appropriately qualified".
While the Equity Release Council said it 'welcomed' the decision, Andrea Rozario, Chief Corporate Officer at Bower Retirement, said the news is "disappointing". She said that a standalone qualification would have been a "great message to the market" highlighting the significant role that equity release has in finance retirement planning.
Concerns had been raised that advisers would make recommendations solely on equity release without considering other types of mortgages available on the market.
Nigel Waterson, Chairman of the Equity Release Council, ecohed this, adding: "Different consumers have different needs, and advisers need a comprehensive knowledge of a range of potential solutions – including those available via the wider mortgage market – to provide well-rounded advice."
However Andrea Rozario responded: "Equity release is different to mainstream mortgage planning requiring different skill sets and the styles of advice in equity release and the mortgage market are very different, and whilst general mortgage knowledge should be part of this exam there are a plethora of other requirements which could have been encompassed by a standalone exam.”
Alice Watson, Head of Marketing at Retirement Advantage Equity Release, also believes that the FCA's decision represents a "missed opportunity" to get more advisers qualified to offer equity release.
Watson added: "We know that recent rule changes and long-term trends mean that most people will only be able to secure the retirement income they want by taking a more a holistic view of what their different pots of wealth, including their properties, can do for them.
“Meanwhile, we also know that although the equity release market is reaching record highs, there is still a huge amount of potential wealth stored in property that people are not tapping into. This is despite the fact that, as our own research shows, most people recognise that their properties are worth more than their pensions.
“As such, there is an increased need for more qualified advisers to meet not just the growing demand for equity release, but also to ensure that those who haven’t considered how their property can boost their retirement finances are introduced to this possibility."
77% of members questioned by the Society of Mortgage Professionals and the Personal Finance Society earlier this year said advisers that don't currently hold mortgage qualifications, particularly those active in giving later life advice, would seek to acquire the standalone equity release qualification.
However the AMI said that calls from individual advisers who want to expand their business by having an ‘easy route’ to a particular product should be viewed with "extreme caution".
The Association also noted the increasing need to link advice on mortgages with equity release as the industry shifts from a pure ‘equity release’ product towards hybrid products which allow servicing and later interest roll-up.
In a statement, the AMI said: "We would seriously question the motive behind an adviser who wants to be able to advise on equity release but doesn’t want to consider other mortgages or to become qualified to do so. It is even more concerning if there is a desire to do this only on an occasional basis.
