Key Group has widened its later life lending advice model, enabling advisers to research and recommend lifetime mortgages, retirement interest-only (RIO) loans and residential mortgages within a single advice process.

The change applies to advisers at Key Equity Release and whole-of-market business The Equity Release Experts (TERE), removing the need for customers to be referred to separate teams when a different type of later life mortgage may be more appropriate.

Under the approach, advisers will consider a customer’s circumstances, objectives, priorities and future needs before assessing whether borrowing is appropriate.

Alternatives can include using other assets or income, downsizing or changing financial plans. Customers can also be directed to specialist support covering areas including debt, pensions, care funding and short leases.

WIDER PRODUCT ASSESSMENT

Where borrowing is considered suitable, advisers can assess options spanning lifetime mortgages, RIO mortgages and residential mortgages before making a recommendation.

Key said its previous advice model already took a broader view of customers’ circumstances, with referrals available to its internal mortgage desk or partner Mortgage Advice Bureau for mainstream mortgage requirements. The latest changes allow advisers to research and recommend a wider range of products themselves.

The group has introduced additional adviser training covering its fact find, different mortgage types and sourcing systems, as well as meetings with lenders. The model was initially tested through a pilot before being introduced in phases.

Mortgage Brain will provide sourcing support for mortgage products that are not covered by Key’s Air later life lending platform. Key is combining the sourcing systems with its own CRM and workflow processes.

REGULATORY FOCUS

The changes come as the later life lending industry faces increased scrutiny over how advisers assess the range of options available to older borrowers. Key said the development reflected issues highlighted in the FCA’s Later Life Mortgages Study as well as firms’ responsibilities under Consumer Duty.

Will Hale, chief executive of Key Equity Release, said: “For a number of years we have adopted a holistic approach across all our advice channels ensuring that, irrespective of the scope of our advice proposition, customers are made aware of all available options and are referred to specialist teams where appropriate.

“This further evolution to holistic advice within a single advice appointment is in our view now essential in the later life lending market. It improves the customer journey, strengthens our advice, and supports better outcomes.

“Product innovation and the broad range of profiles among over-55 customers looking to access their property wealth, or manage mortgage debt, in later life means that product-siloed advice is a major risk to delivering consistently good customer outcomes.

“Given the focus of the FCA on the safe growth of the later life lending market, this is a major opportunity to further enhance our advice service for customers and our introducer partners by making the journey smoother while empowering our advisers with the knowledge and tools to help more customers themselves rather than referring them.

“The process we have introduced demonstrates that all-encompassing sourcing platforms covering every product option available should not be a prerequisite for firms to evolve to more holistic advice models.

“Indeed, it remains the case that comparing lifetime mortgages with other later life lending products is like comparing apples with pears and there remains a major role for specialist sourcing platforms to support different parts of the product landscape.

“More comprehensive fact finding, sophisticated triage approaches and integrated technology driven processes are key elements to delivering holistic advice efficiently and effectively.

“Customers don’t think in product silos. They simply want the solution that best meets their needs delivered through a journey free of unnecessary friction.

“Our role is to ensure every suitable option is considered before a recommendation is made but ultimately to support many more customers access their property wealth to achieve their objectives in later life.”