Reverse mortgage lenders fear the consequences of a future media beat-up as consumers are slow to grasp the finer details of products.
A recent ASIC report All we have is this house indicated that while borrowers were generally satisfied with products, there was still a lack of understanding about the terms and uses of a reverse mortgage – and concern for the way people treated the assets once released.
While the report is generally positive, the sector remains concerned over the impact negative media attention could have on the sector should consumer awareness not improve.
Consumer confidence with this product is critical, explains Bluestone Equity Release CEO Peter McGuinness.
“The influence of the media has a direct link with consumers’ appetite for this product,” he says.
Kieran Dell, Senior Australians Equity Release Association of Lenders (SEQUAL) executive director agrees that the media will play an ever-increasing role in educating customers.
“Because of the complexities of the product, a little knowledge can be quite dangerous. The media is crucial in this lending space,” he says.
“The industry needs to make sure that there aren’t any scandals – this is why education and regulation are so important."
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