The latest report by Age UK has shone light on the growing financial concerns faced by elderly people living in the UK. The report suggests that a significant proportion of elderly people are having to generate funds using products such as equity release to pay off debts.
The study conducted by the University of Birmingham called "Housing and Finance in Later Life", found that almost a third of equity release customers used the funds to help with their financial debt burden.
The report also found that three quarters of people used the product to boost capital to increase their financial security or relieve them from financial difficulties. It would therefore seem that equity release is considered by many as a product that is used as a last resort. In general, most elderly people (over 65s) do own their own homes according to Age UK, however they live on modest incomes and find it difficult to maintain their homes. So much so, that the survey found that about 14% of respondents saw equity release as the last hope to gain access to funds to carry out essential repairs on their house.
What should present a wake up call for equity release providers is the fact that fewer than half of those respondents surveyed were “very satisfied” with the value equity release products offered to them, despite the vast majority (75%) feeling that it was an appropriate product that fit with their circumstances. This presents an opportunity for providers to take a closer look at pricing issues that could win them valuable customers in a competitive marketplace.