Lonsdale Appoints Reverse Mortgage Partners

24 October 2005

Lonsdale Financial Group (Lonsdale) today announced the appointment of three reverse mortgage partners: Bluestone Equity Release, Macquarie and OFM Investment Group.

Mario Modica, Lonsdale chief executive said the national dealer group had been assessing the need for equity release programs among their network of 170 advisers and researching potential suppliers for three months.

“It was imperative that our reverse mortgage partners be members of the equity release association, SEQUAL, ensuring high standards in product design, codes of conduct and disclosure.

“The innovative features that each of our reverse mortgage partners provide was a key attraction. A stand out by two of the three partners is the ‘inheritance protection’ feature which safeguards up to 20% of the value of the property to pass to the estate or set aside for future health care expenses. Another smart feature is a ‘no negative equity guarantee’ which caps the obligation to repay the loan at the recoverable value of the mortgaged property.

“We found the differences in each partner’s offer appealing too. In particular, the range of competitive variable and fixed interest rates and their willingness to constantly improve their offers,” he said.

To be considered on Lonsdale’s reverse mortgage panel, it was essential that each supplier provide a written accreditation program to test the adviser’s product knowledge.

“Half of our advisers are accredited with at least one of our reverse mortgage partners. We anticipate that this will extend to our entire network with most planners becoming accredited with all three providers to ensure a wider choice of equity release product for their clients,” he said.

Mr Modica acknowledges the growing interest and healthy scepticism in reverse mortgages from the public at large and some sections of the financial services industry. “We couldn’t disregard this service as a credible strategy suitable for some of our adviser’s clients. Advisers should be in this market to ensure that clients are getting strategic advice past retirement, especially for asset rich, cash poor retirees.

“Financial counsel from a qualified adviser will take into account a client’s full financial picture when it comes to the appropriateness of an equity release product. A good example where it may be appropriate is when a pensioner has passed away, leaving the remaining partner on a reduced pension income looking to maintain a similar lifestyle or a senior who is looking to fund future aged care,” he said.

Media queries:
Therase Keating
Managing Director
Mint Public Relations
Tel: 03 9687 1073
Mob: 0408 544449