Many people are being advised to use equity release before they retire in order to consolidate their debts in what could be a serious breach of TCF, warns Duncan Young, managing director of equity release provider Retirement Plus.
Young said debt consolidation is the number one reason for using equity release products, but says for people in their 50’s, the use of such a long-term product might not be in the customer’s best interests, “Some providers in the market are now seeing around a third of all cases coming from people looking to consolidate their debt, which is of some concern”, says Young. “This might be appropriate for someone aged 75 who will probably only use the product for ten years or so. However, someone aged 55 could well live for 30 years or more and using a long-term and inflexible equity release...
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