The Equity Release Council has developed a new guide with ratings agency Fairer Finance to help the Council’s members communicate with their customers in the later life lending market.

The guide aims to give customers the best chance of understanding products and services and support them to make good financial decisions.

According to the National Literacy Trust, one in six UK adults have a reading age of 11 or less and would fall short of the standard required to achieve a grade C English GCSE.

Meanwhile, Financial Conduct Authority rules have long since required firms to ensure their customer communications are “clear, fair and not misleading”. This obligation has been reinforced by the introduction of the Consumer Duty last year, which obliges firms to prove their customers can understand their communications.

The Financial Ombudsman Service also considers the readability of documents when deciding if firms have acted fairly or reasonably in the event of consumer disputes.

The Equity Release Council’s new handbook is now available to its membership of more than 750 firms and 1,900 registered individuals, including product providers, regulated financial advisers, solicitors, surveyors and other professionals involved in both consumer-facing and back-office roles.

CEO of the Equity Release Council, Jim Boyd, said: “With more features and flexibilities available on the market than ever before, it is vital that customers understand their options, so they are empowered to make informed financial decisions. This will deliver a lasting benefit to both customers and their families.

“Working with Fairer Finance to produce this guide will support our members to bring modern equity release products to life for customers in ways that are accessible, understandable and easy to digest.”

Founder and MD of Fairer Finance, James Daley, added: “Equity release is a complex product and it’s crucial that customers can understand exactly what they’re signing up to.

“Our guide provides practical advice which will make it easier for lenders and brokers to write, design and structure their documents in a way that is accessible for as many customers as possible.”

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