The Covid-19 pandemic has caused a lot of hardship and anxiety. Some people seeing their families struggle will want to help them out financially and one way to fund assistance is mortgage equity release.

Equity release can be the perfect solution to immediate financial need. A householder might have been planning to gift money to a family member, for example, and the current circumstances have brought that forward. Or maybe lockdown has focused a family’s mind on home improvements, and need to fund a new bathroom.

However, some people may be experiencing short-term vulnerability. They could be under pressure from others who need cash. Under duress, people often make poor financial decisions.

Short-term vulnerability, long-term costs

It’s important to avoid knee-jerk reactions to what may be short-term challenges – particularly as equity release is a long-term commitment.

People who use equity release also tend to be in later life and face particular vulnerabilities. Some may struggle with cognitive decline and with the impact of loneliness and depression – exacerbated now because older people, shielding or social distancing, are often separated from friends and family.

Technology can be another hurdle for some older users – and place a barrier between mortgage adviser and client.

Since the lockdown I’ve been talking to my mother on zoom calls. All I’ve ever seen of her face are her eyes and the top of her nose because she sits too close to the camera. That makes it difficult for me to see how she’s really doing. I have to keep reminding her to move back so I can see her properly.

That might sound comical, but it’s a genuine concern. I know my mother well and talk to her daily, but I’m not confident I really know how she is. Without seeing her in person, in her home, all I know is she’s telling me everything’s okay and, like many older people, she would say that. She wouldn’t want to be a worry.

That’s a problem for anyone on a video call with an elderly person – especially when advising on a financial commitment as large as equity release.

Advising online

For mortgage advisers, technology has been a boon during lockdown. We can use video calls, online signatures and desk-top valuations but only when dealing with clients without vulnerabilities. For clients who struggle with technology, or who face personal difficulties, online advice can be less than helpful.

Why?

In person, it’s relatively easy for an adviser to spot vulnerabilities, especially if you’ve known the client for many years. Over a slow broadband connection, with bad audio and poor screen resolution, which the client can’t fix, you have to be extra vigilant to spot the red flags that would be obvious face to face.

We’ve been trained to look for physical clues as well as verbal ones in conversations with clients: nodding without following what is being said; seeing that a home is suddenly less well kept; that the person is becoming forgetful; or recognising the effects of bereavement.

So what extra caution should we take using technology, especially if all you can see is someone’s eyes and they tell you everything is fine?

When a client is vulnerable

We still need to look out for subtle changes in behaviour, decision-making and comprehension, and you do that by listening more – and listening more carefully.

Vulnerability is not the same as an inability to make decisions. However, the adviser needs to ensure a trusted family member or professional (such as a solicitor) is on the call to give the client the right level of support – so they’re not taking a major financial step they’ll regret.

That trusted person needs to be validated by the adviser. They could be the person named as having lasting power of attorney, or they might be the designated executors of a will.

Many people in the country are under stress – they’ve been ill, suffered bereavement, or lost their job – so advisers need to proceed with care and some lines shouldn’t be crossed.

In particular, if someone has suffered a major life event such as the loss of a partner, decisions on a commitment like equity release should be paused if possible and reconsidered at a later date.

Of course, some people are resilient. Some find an illness spurs them on to make essential financial arrangements such as setting up a lasting power of attorney. But most of us will be struggling with fallout from Covid-19 for months to come.

Getting used to technology, and ensuring clients do too, is helpful. You could set up a separate call to coach your clients through it and explain how you’ll be conducting meetings for the foreseeable future. That could make for more effective client meetings for years to come.