Equity Release Council modifies legal advice rules during COVID-19 lockdown

Share this article

The Equity Release Council (ERC) has published temporary modifications to the requirements for customers to receive face-to-face legal advice.

The modification has been made in response to the national lockdown to stop the spread of COVID-19, which prevents in-person meetings.

Legal advice will now be able to be provided remotely during social distancing, but this will cease as soon as the government ends the social distancing requirements.

The new process will involve a combination of written and documented video or telephone advice, and will increase the number of interactions between customers and legal advisors.

Legal advisers must ensure that: the client’s identity has been fully established; they have the mental capacity to enter into an equity release contract; they are not under duress; all parties involved agree to enter the contract.

During this period, the physical witnessing of the client’s signature may be carried out by an independent adult witness of their choosing, subject to identity checks and due diligence.

Any case in which sufficient checks cannot be completed should be delayed until coronavirus-related restrictions have been lifted.

The modification follows a consultation with members of the ERC and the wider industry regarding the most effective way to maintain the necessary product safeguards while protecting health and wellbeing.

This change was supported by the ERC’s Standards Board, which is comprised of independent consumer and regulatory experts.

David Burrowes, chairman of the ERC, said: “These are unprecedented times and the Council is pleased to have secured industry support for a solution that ensures consumers can continue to access quality, independent legal advice when considering whether to release equity from their homes.

“The new measures have been designed with input from expert solicitors who provide legal advice on equity release transaction across the UK.

“It is designed to support large and small solicitors to advise safely on equity release at this time.

“This unique and temporary solution is the result of collaboration and sharing of legal expertise among Council members in challenging circumstances, to ensure consumers’ interests remain protected.

“The Council will keep this modification under close review until it ceases, when the government ends its ‘stay at home’ requirement.

“The process has also reaffirmed the value of the ‘gold standard’ face-to-face requirement for independent legal advice which is retained to use if and when government guidelines allow.

“Property wealth plays an increasingly important role in later life planning, and these measures to maintain access to equity release legal advice for older consumers will continue to ensure it is chosen for the right reasons, as part of a carefully considered process that looks at both short and long-term needs.”

Share this article

Written by: Houseladder



Free Ad    Mortgages    Energy    Broadband