How to spot equity release referral opportunities in your new and existing client base
As a mortgage broker, your role goes beyond securing the best mortgage deals for your clients. You also act as a financial guide, helping your clients navigate the complex world of homeownership and making sure they’re aware of options that could enhance their financial wellbeing. One of the increasingly popular financial solutions for older homeowners is equity release, which could unlock the value of their property to support retirement plans, home improvements, or debt consolidation.
Being able to spot clients who could benefit from an equity release plan is crucial for building long-term relationships, providing better service, and, importantly, expanding your referral network. If you recognise the signs and ask the right questions, you’ll be in a position to refer them to Equity Release Partners who can provide tailored solutions. Here’s how mortgage brokers can identify clients who may be eligible for equity release.
1. Clients aged 55 or older
Equity release is specifically designed for homeowners aged 55 or above, making age the first key indicator. While many mortgage brokers primarily work with first time buyers or younger homeowners, clients in the later stages of life may need a different type of financial advice.
If your clients are in this age group and own their home, they could be potential candidates for equity release. It’s important to note that the maximum borrowing limit for equity release plans increases with age, so older clients may be eligible for a higher payout.
2. Homeowners who have significant property value but limited income
Clients who have a substantial amount of equity in their property but limited income may struggle to maintain their lifestyle or meet other financial goals. These clients may be nearing retirement or already retired and are unable to work or supplement their income.
For example, a retiree who owns a home valued at £400,000 but receives a modest pension may benefit from releasing some of their property’s equity. Equity release could provide them with a lump sum or regular income to supplement their financial needs, helping to enhance their quality of life without the need to sell their property.
3. Clients looking to fund retirement plans or long-term care
Homeowners who have expressed concerns about funding their retirement or paying for long-term care might be good candidates for equity release. If a client is worried about their financial security in later years, an equity release plan could offer a solution. Equity release allows clients to access the value tied up in their homes to fund retirement living expenses, healthcare costs, or modifications to the home if needed for mobility reasons.
Look for signs that your clients are actively planning their retirement but may lack the liquidity to comfortably support it. If they’re worried about their pension or savings falling short, they could be a candidate for equity release.
4. Homeowners with existing mortgages
While clients who have fully paid-off properties could be suitable for equity release, homeowners who still have an outstanding mortgage could also be eligible for equity release. These clients may be interested in using the release of equity to replace their existing mortgage debt, consolidate other liabilities, or improve their financial situation in retirement.
Look out for clients who express dissatisfaction with their existing mortgage terms, or clients who might be struggling to keep up with mortgage payments as they near retirement age. By referring them to an Equity Release Partners, they could potentially access funds to pay off their mortgage and avoid financial stress later on.
5. Clients seeking debt consolidation
Many older homeowners who face significant debt or other financial burdens might not realise that equity release could help with debt consolidation. If your client is overwhelmed by multiple debts and finds it difficult to manage, releasing equity in their home could help clear some of that debt, leaving them with a more manageable financial situation.
While many homeowners in debt may think they can only consider unsecured loans, equity release could offer an alternative, especially for those who own significant property value but lack sufficient income to qualify for conventional loans.
6. Clients interested in home improvements
Older homeowners who wish to make home improvements but lack the funds might consider equity release as a way to finance necessary renovations. This can be especially useful for clients who want to make the property more accessible, such as installing ramps, stairlifts, or making other modifications to support aging in place.
If your clients are nearing retirement age and show interest in long-term modifications to their home, this could be an opportunity to introduce equity release as a viable solution.
7. Clients who want to leave a financial legacy
Some homeowners may not need to access the money for themselves, but they might be interested in leaving a financial legacy to their loved ones. Equity release could allow clients to access the funds now while still maintaining ownership of their home, with the balance typically repaid when the homeowner passes away or moves into care.
If clients express a desire to leave an inheritance or assist family members with housing or education costs, this could be another area where equity release can come into play.
8. Lack of suitable alternatives
For some older clients, traditional loan options or refinancing might not be available due to age, income restrictions, or the property’s value. If your client is looking for alternative solutions to secure cash flow but is finding that traditional financial products aren’t viable, this could be the perfect opportunity for you to refer them to Equity Release Partners.
9. Clients seeking a “no monthly repayment” solution
Some older clients may find monthly mortgage payments or loans difficult to manage. Equity release is appealing because it typically doesn’t require monthly repayments. Instead, the loan is repaid when the client moves into permanent care or passes away. This feature can be highly attractive to retirees who want to ease their financial burden without worrying about monthly outgoings.
Talk to Equity Release Partners
By being attentive to the signs and asking the right questions, mortgage brokers can help identify clients who may benefit from equity release. These conversations often start with questions around retirement plans, home improvements, or concerns about funding long-term care. Referring these clients to an equity release specialist like Equity Release Partners not only helps them access a valuable financial tool but also helps expand your professional network, build trust, and ensure your clients’ financial needs are met in a holistic way.
Remember, you don’t need to be an equity release expert yourself; your role is to recognise the need and make a connection with a trusted specialist who can provide tailored solutions.
For more information about our smartERTM equity release referral service click here or call 0800 088 5950.
