Suncorp joins reverse mortgage protection body

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Suncorp is the latest lender to join the reverse mortgage industry lenders association, SEQUAL, following the launch of Suncorp’s new reverse mortgage product in March.

SEQUAL (Senior Australian Equity Release Association of Lenders) is the not-for-profit, self-regulatory body which governs reverse mortgage lenders. Its charter is to guide ethical development of the sector and offer consumer safeguards to retirees. Reverse mortgages allow seniors to borrow against the equity in their homes to support their retirement.

As a SEQUAL member, Suncorp will adhere to a strict Code of Conduct that requires seniors to obtain independent legal advice and offers a ‘no negative equity’ guarantee so retirees can never owe more than the value of the home.

According to Kieren Dell, executive director of SEQUAL, Suncorp’s accreditation is an important addition to SEQUAL.

“SEQUAL now governs more than 95 percent of reverse mortgage lending. Suncorp’s membership and adherence to SEQUAL’s Code of Conduct means retirees are even further protected,” said Dell.

“Suncorp recognised SEQUAL’s critical role protecting current and prospective reverse mortgage borrowers. It joined SEQUAL for its leadership initiatives, such as educating and accrediting brokers and other advisers as well as tightening no negative equity guarantees,” said Tim Buckett, Suncorp Executive General Manager of Retail Lending.

“Suncorp wants to ensure that it plays an active role in helping to develop the reverse mortgage market. Our SEQUAL membership will ensure the best practice growth of our reverse mortgage portfolio.”

Mr Buckett said Suncorp’s reverse mortgage product had attracted a great deal of interest amongst those customers who wished to realise the gains in the value of their property in the short time since it was launched.

“Many retirees have seen the value of their home grow as property prices have increased over the past decades,” he said.

“They recognise that our product can help them to fund a more pleasurable retirement by giving them the opportunity to draw down from the capital growth they’ve made over the years, while still maintaining ownership of their home.”

According to the SEQUAL-RFI It’s All On the House study, retirees hold little cash wealth with 60% of retirees’ wealth held in property assets, predominately the family home. The report found that a modest increase in income would significantly improve the lives of most retirees. Fifty percent of respondents indicated that as little as $300 per month ($3,600 per annum) would be sufficient to improve their life.

For more information about SEQUAL, its members and code of conduct, go to www.sequal.com.au

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