People considering a reverse mortgage or any other multifaceted loan product should seek the advice of a professional broker, trained in complex mortgage products, the Mortgage and Finance Association of Australia (MFAA) said today.

“We recognise that reverse mortgages are complicated products that can be of great value to retirees who are asset-rich, but cash-poor and who are seeking a line of credit,” Phil Naylor, CEO of the MFAA, said.

“As an organisation that has been educating people on equity release products for a long time, the MFAA supports all efforts by other organisations seeking to do the same.”

ASIC and the Australian Government Financial Literacy Board yesterday launched Thinking of Using the Equity in Your Home?, a guide to assist people in assessing whether an equity release product is right for their individual situation.

“A reverse mortgage is a loan which gives people a lump sum, a line-of-credit, or money in regular instalments. It is effectively a loan against the value of the home that lets people unlock the equity in their home,” Mr Naylor said.

“Any MFAA member who wishes to provide reverse mortgage products must successfully complete a SEQUAL accredited programme on equity release products. Our own programme was the first to receive such accreditation.”

The MFAA has its own consumer education website www.essentialsofborrowing.com.au which includes information on reverse mortgages.

“Speaking with a broker who is specially trained to recommend the products you are seeking means that you will get the best advice available to you,” Mr Naylor said.