The UK’s leading whole of market equity release experts, Equity Release Group (ERG), has called for the sector to level-up. The firm reveal there’s a need for an improved consumer experience across the sector, to meet the demands of consumer duty and align to the smart technology now available within the industry.
Whilst in the past, it was noted that financial data within the equity release market has been somewhat behind in comparison to what is available in the traditional mortgage market, more products and online platforms do now exist to enable consumers to research and discover their own personal financial options.
Mark Gregory, Founder & CEO at Equity Release Group said “Providing a gateway to more extensive information, online tools, access to comparison websites and personalised deals specifically based on individual circumstances is, we believe, helping to eradicate the general lack of information available.
“Online tools providing flexibility and choice around products, coupled with transparency is a step forward in making it possible for people to begin to understand the different products that might work for them, before then going through to an Adviser. However, we need information available to be one hundred per cent accurate in order for consumers to instil trust and reliance in that data and within our industry.”
According to their latest findings following a conducted and co-ordinated UK review of selected websites – excluding data from Equity Release Supermarket – more than 50 per cent highlighted inaccurate calculations, with one major broker being the least accurate of all. Whist this figure is lower than ERG’s survey held last year, with more than 40 per cent surveyed improving their data outputs, progress still needs to be made.
The results of the research highlighted that 15 per cent were completely unsuccessfully (i.e. no data available or no longer existed) yet proceeded to capture consumer’s details under misleading pretences regardless.
A third of those calculators gave lower LTVs and loan amounts than IRESS and Equity Release Supermarket. However, what is rather concerning is that over a quarter of the calculators checked provided higher LTVs and maximum loan amounts than IRESS and Equity Release Supermarket Therefore, consumers would not be able to proceed further, which fails to set the standard of firms acting in good faith.
Perhaps most shockingly, the erroneous data extended as far as to showcase that a customer could borrow more than the largest loan available within the equity release market. For example – An 85-year-old with a £300,000 property, was offered a loan amount of £181,500, representing a 60.5% LTV, when the largest release available at the time of the study was a £159,075** (53% LTV).
This discovery comes as Equity Release Supermarket have extended their offering this year to provide 21 calculators for consumers, alongside comparison tables which are all connected into one live product database – kept up to date by the lenders themselves. Their smartER™ platform also enables consumers to research real-time deals that match their personalised circumstances. Due to the heightened demand for accurate information, Equity Release Supermarket have benefited with lower acquisition costs by providing live and accurate information.
Given the firm has inbuild technology that allows for real time data to be pulled centrally from the database, consumers don’t suffer from any time delays, changes within the market or data fluctuations.
The results are live – a technical ability others are unable to provide to consumers.
This transforms and modernises entry to market by providing precision, whilst fundamentally aligning to consumer duty – providing transparency, accuracy, and WOM information to best serve the market.
Mark added: “Technology has been the catalyst in our growth journey, powered by the vision for an
independent market. Our aim is always to support consumers by providing real-time, accurate data, and to help the wider industry through the provision of smartER technology. We conducted a similar study earlier last year and since then we have seen a marked improvement, however there is still some way to go.
“It is still a challenging time for the industry, however it’s important we collectively drive the best possible consumer standards and we’re here to support any equity release firm in achieving that.”
