Have You Been Mis-Sold Equity Release? Here’s What You Need to Know

January 9, 2025

Equity release can be a helpful financial tool for homeowners over the age of 55, enabling them to unlock the value of their property without having to sell or move. However, not all equity release agreements are sold fairly. If you suspect that you’ve been mis-sold an equity release product, it’s important to understand the signs and know what steps to take if you have.

What Is Mis-Sold Equity Release?

Mis-selling occurs when an equity release product is sold inappropriately or without proper disclosure of its terms and risks. This can leave individuals in financially vulnerable situations, often without realizing it until it’s too late.

Signs You May Have Been Affected

Not sure if you’ve been mis-sold equity release? Here are some common red flags:

  • Lack of Transparency: You weren’t fully informed about the terms, costs, or long-term impact of the product, such as the effects on inheritance or means-tested benefits.
  • Unsuitable Recommendations: The product doesn’t align with your financial needs, and alternative options (e.g., downsizing or conventional loans) weren’t explored.
  • Pressure to Decide: You felt rushed or pressured into making a decision without enough time to consider your options.
  • Hidden Fees or Costs: The full costs, including interest rates and setup fees, weren’t clearly explained.
  • Failure to Assess Suitability: The adviser didn’t properly assess your circumstances, including your income, future needs, or care requirements.

Steps to Take if You Suspect Mis-Selling

If any of the above signs resonate with you, here’s what to do next:

  1. Gather Your Documentation: Collect all paperwork related to the equity release product, including contracts, correspondence, and advice notes.
  2. Review the Advice You Received: Look for gaps in information or instances where risks and costs weren’t clearly explained.
  3. File a Complaint: Write a formal complaint to the firm that sold you the product, outlining your concerns.
  4. Escalate if Necessary: If your complaint isn’t resolved, you can escalate it to the Financial Ombudsman Service or seek help from the Financial Services Compensation Scheme (FSCS) if the firm is no longer operating. You can do this for free.
  5. Seek Professional Assistance: Navigating the claims process can be complex. If you need help consider using a Claims Management Company (CMC). You will be charged a fee, so shop around and check reviews.

 

 

Compensation Adviser is a claims management company specialising in assisting people with financial compensation claims.

You do not need to use a claims management company (CMC) to make your complaint to your equity release company and if your complaint is not successful you can refer it yourself for free to the Financial Ombudsman Service (FOS).