We caught up with a colleague and friend of Personal Retirement Planning – Emma Knapp, Key Account Relationship Manager at Canada Life, to talk about Equity Release.
Tell us about your role at Canada Life
I work as a Key Account Manager within the Home Finance team. In a nutshell, I support and manage our key mortgage firms and networks within London and the South East region and the business they write with us. I’m on hand to support them with anything they may need – from pre-application queries through to market trends.
How has the face of retirement changed?
Retirement it seems, is not what many people hoped it would be. The increasing cost of living coupled with deflated pensions is sadly resulting in people finding themselves struggling financially in later life. People aged 85+ are the fastest growing age group in the UK population, and they’re seeing additional hurdles such as increasing life expectancy and needing to pay for care – either in the home, or within a care home.
How has later life finance changed in the last couple of years?
Equity release has changed dramatically over the past couple of years and excitingly, it continues to evolve alongside market demands. Although public perception and product reputation is still a slight barrier for the sector, many common misconceptions are slowly being broken down through people educating themselves and researching their options. Later life lending will not be suitable for everyone of course, but it can be a great solution for many homeowners that want or need to release some equity.
Using property wealth is no longer considered the choice of last resort but instead a sensible and imperative part of wealth planning and should be considered alongside pensions, investments and other potential assets.
Why do you think more people are considering equity release in later life?
I think there are a multitude of reasons, so to name a few: average interest rates are currently low compared to historic rates – sitting at 4.26% in July 2021 compared to 5.96% in July 2016. Rates are also largely fixed for the life of the mortgage which gives clients peace of mind. Clients are able to repay the interest and service the loan should they wish to, which satisfies any concerns they may have about interest rolling up. They can also choose products with fixed early repayment charges so they know where they stand should their circumstances change. Alongside the product features, it can be a very tax efficient way for homeowners to manage their wealth and estate and on top of all of this; they continue to own their home!
Where do you see Canada Life in the lifetime mortgage space going forward?
Canada Life will continue to drive the sector forward through proposition innovation. We continually look at our proposition to find ways to meet real customer needs, and help more homeowners access equity from their properties in order to enhance their lives and that of their families.
Canada Life are known for having stretch in their underwriting criteria where it is sensible to do so, as well as lending on second homes and buy-to-let properties. Our secured funding deals have seen us increase our appetite for lending volumes in recent years, and we’ve grown from being a specialist player to one very much in the mainstream. We expect this growth to continue and we’re looking forward to helping thousands of financial advisers and customers as we continue to engage with them and provide market-leading products and excellent service for all.
What is your relationship with Personal Retirement Planning?
Personal Retirement Planning are one of my Key Accounts that I look after. They are a team of Equity Release Advisers and we work together to help homeowners release equity during later life. They are a lovely firm to work with and I look forward to continuing our relationship.