Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 

Industry Welcomes Home Equity Release Code

17 May 2005

Industry Welcomes Home Equity Release Code

The Government’s signalled intention to develop a code of practice for home equity release schemes has been warmly welcomed by the industry’s leading provider of HER product, Sentinel.

Sentinel Managing Director Richard Coon said today that the announcement funds would be made available in this week’s budget to enable the Office for Senior Citizens to develop the code is extremely pleasing and is good news both for the industry and for older people.

“Sentinel has been working with the Minister for Senior Citizens, Ruth Dyson for several months on this issue. We have been proactive in promoting our belief that a code of practice agreed to by the whole industry is the best way to cover matters such as disclosure of terms and conditions, risk management practices and recovery,” Mr Coon said.

Mr Coon said home equity release was increasingly being viewed as a practical solution to the problem of financial resources for a sector of the growing numbers of New Zealanders who own their own homes, but who no longer have the income to maintain them or their standard of living.

“It’s long been a kiwi tradition to invest our savings in our own homes. But as with any other kind of saving, there often comes a time when it’s more important to use that money for quality of life. Our research shows many people are using home equity release to continue to enjoy living in their own homes in safety and security.”

While Mr Coon said home equity release had an important part to play in older kiwis’ well-being, it was vital that users had confidence in product providers and their integrity.

“The kinds of safety measures we would like to see put in place include a no-negative equity guarantee, ensuring the value of the home will never exceed the net sale proceeds of the property; guaranteed occupancy for life for those designated as nominated residents; no requirement for payment until the residents cease to occupy and the home is sold.

“We would also recommend that clients receive independent financial advice and be represented by their own independent lawyer,” Mr Coon said.

“Sentinel looks forward to working with Government to develop a code which puts industry controls in place to protect the public from any hidden risks while reassuring them that home equity release is a way to make people’s later years in life more comfortable and financially viable.”

Since forming in February 2004, Sentinel has received 1300 applications for home loans with a total value of over $50 million. The average loan amount is $42,000 and the average age of the borrower is 73.

ENDS

© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

Media Mega Merger: StuffMe Hearing Argues Over Moveable Feast

New Zealand's two largest news publishers are appealing against the Commerce Commission's rejection of the proposal to merge their operations. More>>

Elsewhere:


Approval: Northern Corridor Decision Released

The approval gives the green light to construction of the last link of Auckland’s Western Ring Route, providing an alternative route from South Auckland to the North Shore. More>>

ALSO:


Crown Accounts: $4.1 Billion Surplus

The New Zealand Government has achieved its third fiscal surplus in a row with the Crown accounts for the year ended 30 June 2017 showing an OBEGAL surplus of $4.1 billion, $2.2 billion stronger than last year, Finance Minister Steven Joyce says. More>>

ALSO:

Mycoplasma Bovis: One New Property Tests Positive

The newly identified property... was already under a Restricted Place notice under the Biosecurity Act. More>>

Accounting Scandal: Suspension Of Fuji Xerox From All-Of-Government Contract

General Manager of New Zealand Government Procurement John Ivil says, “FXNZ has been formally suspended from the Print Technology and Associated Services (PTAS) contract and terminated from the Office Supplies contract.” More>>