Training

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Training

• A presentation on behalf of the institute of
  financial services

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FSA warns advisers that unsuitable equity release
advice has got to stop (FSA Press release24/05/05)
Clive Briault

• Our work has found another disappointing
  instance of many advisers giving poor quality
  advice

3
Regulations covering Lifetime Mortgages

• MCOB 8. Lifetime Mortgages and Selling Standards.
• MCOB 9. Lifetime Mortgages Product Disclosure.

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Training Competence Sourcebook

• The activities are
• 1  advising on standard mortgages
• 2  advising on lifetime mortgages
• 3  supervising sales staff carrying out
  non-advised lifetime mortgage
  sales, and
• 4 designing scripted questions for use in
  non-advised lifetime mortgage sales.

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Transitional arrangements for the sale of
mortgages

• Transitional arrangements will deal with any
  interim period between 31st October 2004 and the
  new examination arrangements taking effect.
• The FSA intends to grandfather for T C
  purposes, advisers who have already met the
  MCCBs F C requirements.

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Ask yourself five questions! 

• Do I know enough about means tested benefits?
• Would the creation of a mortgage mean that client
  would lose an Age
• Allowance benefit?
• Could I prove I know the answers to these
  questions?
• Could I prove I have checked these for that
  client?
• Do my advisers know the answers to these
  questions?

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Ask yourself three questions!

•  
• Do I know about local authority grants?
• Do I know about local authority grants in other
  geographical locations?
• What is the difference between a home reversion
  scheme and a lifetime mortgage or are they the
  same? 

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• The personal client considerations are different,
  for example the regulations also require firms to
  take into consideration, and evidence that they
  have, the following  
• future intentions for estate distribution
• customer state of health and life expectancy
• full knowledge of the lifetime mortgages
  available to the firm and the trade bodies which
  represent this sector of the market

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Appropriate examinations

• Instead of their being approved examinations
  (i.e. CeMAP, MAQ, CIOBS) as in the past, firms
  will be identifying and using appropriate
  qualifications in deciding the best standards for
  their staff and their business.
• The Skills Council for Financial Services) will
  maintain a suitable list of qualifications.

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National Qualifications Standards Framework
International Standards for Financial Planning
(ISO)
Pension transfer specialist
Broker fund adviser
Trusts planning
Taxation planning
Derivatives
Corporate finance
Investment mgmnt
Retirement planning
Protection
Long term care
Lifetime/ Mortgages
Corporate business
Employee benefits
Securities
Advice skills
Investments and risks
Fin. environ regulation and ethics
Foundation Skills, e.g.. Customer Service, ICT
Introduction to Financial Services
Mini
Mini
Mini
Mini
Formal learning Schools / Colleges / Universities
Lifelong learning Consumer Education
For an IFA
Other options, some not reviewed

focus of Stage 2 of Review
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FSSC appropriate qualification suppliers
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(No Transcript)
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Appropriate ExaminationStandards

• CeMAP/CeMAP Bridge (or equivalent)
• the Investments and Risks module from
• CeFA (or equivalent) plus
• the ifs Certificate in Lifetime Mortgages.

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Aims and objectives

• the advice process
• the UK finance industry and the regulatory
• and ethical framework for giving lifetime
• mortgage advice
• different types of equity release solution
• and the criteria for determining their
• suitability and affordability.

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Learning outcomes

• Demonstrate knowledge of the definition of a
  lifetime mortgage.
• Demonstrate an understanding of
• the principles of equity release, the types of
  equity release schemes available and the
  applications for which such schemes might be
  appropriate
• the types of borrower at whom lifetime
  mortgages are targeted and their particular
  requirements (both personal and financial)

16
Learning outcomes continued

• the circumstances where equity release may be
  appropriate and how these influence the
  borrowers purpose(s).
• what happens when the borrower dies or goes
  into long term care, the type of advice that may
  be appropriate and when to offer such advice
• the key features, relative benefits and risks
  of lifetime mortgages and the principal products
  and services that are alternatives to lifetime
  mortgages.

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Learning outcomes continued

• Demonstrate an ability to analyse
• the suitability and affordability of the
• different types of lifetime mortgage
• products and their principal alternatives.for
  different types of borrower.
• Demonstrate an ability to assess
• the risks to consumers associated with taking
  out equity release, and when these might arise

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Learning outcomes continued

• the relative levels of risk for different
  consumers taking account of the relevant factors.
• Demonstrate an ability to apply
• the rules relating to state benefits to provide
  appropriate advice to consumers regarding a
  potential loss in entitlement due to an increase
  in income or capital, including how these may
  vary by Local Authority.

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Certificate in Lifetime Mortgages

• A Single Module
• 50 to 60 hours of learning
• Two hour multi choice exam using both single
  choice and case studies
• Electronic assessment at one of 150 Pearson
  locations in the UK
• Immediate results and feedback
• Cost of the module 105 to include materials and
  assessment

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Additional study support

• Shadow papers can be purchased for 10.
• For further information or to order material
  please contact Customer and StudentServices on
  01227 818609.
• Visit our website at www.ifslearning.com

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Financial Services Consumer Panel press release
of 24/05/05
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(No Transcript)