BY ELIZABETH MCARTHUR | THURSDAY, 13 JUN 2019 11:52AM
The ASX-listed investment platform has released a first of its kind senior equity release product for Australia, targeting financial advisers working with clients over 60.
DomaCom’s senior equity release product launched this week with an accreditation course that will enable advisers to provide sign-off to seniors over the age of 60 who are looking for an equity release on their home.
It is the first equity release to be issued as a financial product in Australia. All other equity release products are structured as either credit or real estate products.
DomaCom said the traditional structuring of these products excludes financial advisers who do not hold the appropriate credit or real estate license required to use those products.
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DomaCom chief executive Arthur Naoumidis said: “Senior Equity Release is the first financial product in this space that will give financial advisers a significant place at the table in a growing and vulnerable sector that in many cases is asset rich and cash poor. Hence accreditation is crucial and the first group of advisers will be going through that over the next few days.”
DomaCom said it took six and a half years for the company to secure the necessary reliefs from ASIC to launch the product.
The product has undergone substantial review from the regulator, as well as consumer testing.
The senior equity release will mean advisers can connect aged clients with wealth accumulation clients such as SMSFs – who may have a similar time horizon in terms of their respective needs.
Seniors can apply to sell a fraction of their home with this product and must nominate the amount they then wish to receive as a lump sum or monthly payment.
DomaCom said by receiving a monthly payment through this product seniors will have flexibility to dial up or down the payments as additional funds are required.
When the property is sold in full the vendor and investors receive their share of the sale price.
Investors have the option to sell their units via DomaCom’s online liquidity facility which has buy/sell order screens.
Read more: DomaCom, Senior Equity Release, Australia, Arthur Naoumidis, ASIC