Blog > Equity Release Council’s new report on vulnerable customers

Equity Release Council’s new report on vulnerable customers

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By Clare Yates • 22nd July 2024 • 3 min read

New vulnerability report highlights complexities of issues faced by customers

Written in line with our editorial policy.

The Equity Release Council has revealed its latest Vulnerability Vigilance report to highlight the challenges facing some customers during the equity release process. 

It’s good news for customers, as the insights within the report will better inform industry advisers, providers and solicitors about issues surrounding vulnerability – and how to enhance support for homeowners in this category.

To prepare the report, the Equity Release Council examined 316 cases where customers were identified by their legal advisers as potentially vulnerable in 2023. 

According to the Financial Conduct Authority, 47% of UK adults have one or more vulnerable characteristics. The Council’s report explored the different reasons as to why the customer was identified as being vulnerable and found:

  • Health issues – often due to older age – were the most common reason, accounting for 44% of cases
  • Capacity issues was the second most common reason (23%). These include low ability to manage finances, poor literacy or poor English language skills, learning difficulties and low access to help or support.
  • Undue influence – when a client is being pushed or manipulated by someone they trust, such as a family member – was the third most common reason (15%).
  • Being under duress (5%) was the fourth reason. This is when a client is being coerced into deciding against their will. For example, if someone repeatedly expresses reluctance to arrange a plan, but their spouse or partner insists on proceeding.
  • Other reasons included legal vulnerabilities (8%) and suspected criminal activity (2%).
  • In almost a quarter of cases (24%), more than one vulnerability was identified, highlighting the complexity of issues faced by customers.

Why identifying vulnerabilities is important during equity release

The average equity release customer is almost 70-years old. They are considering what is typically a lifetime commitment, so the Equity Release Council has strict rules in place to protect them. 

All equity release providers and advisers who are members of the Council must abide by these standards. They include the rule that all customers must have at least one in-person face-to-face meeting with a solicitor during the process.

This enables solicitors to ensure their clients fully understand the risks, implications and specifics of the plan they have chosen. The meetings also enable legal advisers to identify potential vulnerabilities, including suspicion of duress or coercion from relatives or anybody else who might benefit from the arrangement. 

If the solicitor thinks a customer might be vulnerable, they can facilitate access to relevant support to help them make informed decisions. Being identified as vulnerable does not necessarily mean a person cannot go ahead with equity release. They may for example be able to proceed after having access to larger print documents, or with the solicitor reading through the documents with customers while answering questions.

If significant vulnerabilities are identified, such as capacity issues or duress, then additional input may be needed from specialists such as a GP, mental capacity assessor or language translator. Ultimately, the focus will always be on the customer having access to all the information and support needed to make the right choice for their needs.

According to the Council’s report, more than three-quarters (78%) of cases identified as potentially vulnerable were able to move forward with additional support. The remaining 22% were unable to proceed with their plan, typically citing either vulnerability issues or a change in customer circumstances.

Do you want to discuss the option of equity release?

If you are thinking about tapping into your property wealth with equity release, then do get in touch. Call us on 0808 178 3055 and we’ll arrange a no-obligation appointment with one of our selected advisers, who can confirm your eligibility for equity release and look for the best equity release rates from leading providers. 

Remember, if they do not think equity release is the best financial option for you right now, they will tell you. It is a completely pressure-free opportunity to learn more about how a plan might work for you.

If you’re unable to talk now, request a call back and we’ll call when it’s convenient to you. You can also get a quick estimate of how much money you could unlock from your home with our free equity release calculators.

About Clare Yates. With over a decade’s experience writing about later life financial planning, Clare offers a wealth of knowledge about equity release, pension annuities, wills, LPAs and more. When she isn’t writing, Clare likes to spend her time baking and going on walks with her husband, two children and their rescue dog. Follow Clare on LinkedIn

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