Over 85% of equity release calculators provide information that is “misleading to consumers”, research from Equity Release Supermarket shows.  

The later life advisory service conducted an analysis of comparative websites giving them three scenarios, based around the age of the customer, their property value, and their loan to the value of their property.   

This was compared against Iress broker sourcing software and equity release scheme loan models.  

The service found that more than 63% of the calculators checked provided higher loan-to-values and maximum loan amounts than Iress and equity release scheme models.   

One example showed that an 85-year-old with a £300,000 property, could be given a loan amount of £192,000, representing a 64% LTV, when the largest loan available on the day of the study on 19 July was a 50% LTV, or £150,000.   

It found that customers aged over 70 were repeatedly given higher maximum lump sums than would be available to them.  

The study also revealed that almost a quarter of these calculators gave lower LTVs and loan amounts than customers could have borrowed.  

The firm notes that these later-life product scenarios do not exist, so consumers would not have been able to proceed further.  

But it adds: “With Consumer Duty guidance coming into force on 31 July, this certainly fails to set the standard of firms acting in good faith.” 

The study points out that some of the calculators researched, give a disclaimer that its results are ‘just a guide’, however, “this still provides false hope to consumers with the majority of these also reflecting higher amounts as opposed to lower”.  

Equity Release Supermarket founder and chief executive Mark Gregory adds: “This study was conducted in light of the new Consumer Duty regulations launched last month.   

“We appreciate that it’s 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.”