The guide is available to consumers via this link.
The content was informed by a working group, led by Just Group and including ERC members such as advisers, providers and legal experts.
The guide sets out a “consistent way” to describe fees and charges throughout the customer journey using “clear, simple and standardised language” that is easy to comprehend.
Equity release firms are being encouraged to adopt the language in the guide to make it easier for consumers to compare products and their costs.
The ERC said the guide aimed to improve consumer understanding, which is one of the key objectives of Consumer Duty, and accounts for recommendations from Financial Services Consumer Panel which called for “standardised disclosure for fees and charges”.
Jim Boyd, CEO of the ERC, said: “When people take out any new financial services product such as equity release, they often face a few unfamiliar terms and definitions. Each firm often uses slightly different language which makes it harder for consumers to quickly identify how product fees differ and can be challenging when comparing costs.
“The council’s guidance describes all the fees and charges that could be relevant to an equity release application, depending on its complexity. Our aim is to establish a set of standard definitions to help consumers to understand their options as they explore the equity release process with a regulated adviser.”
He added: “We understand adopting changes takes time, but the arrival of the Consumer Duty is a chance for industry to take stock and move towards a standardised approach. We hope all firms will take this guidance on board when they next revisit their approach, so it becomes the standard across the equity release market.”
Stephen Lowe, group communications director at retirement specialist Just Group, said: “Just Group led the council working group that resulted in this theme being developed so we welcome the council’s announcement to standardise fees and charges definitions.
He continued: “Just has strong credentials in championing shopping around across the wider retail market so we’re pleased to help empower customers in this way. We wanted to remove barriers that can make it difficult for people to shop around and make comparisons between providers.
“This work to encourage firms to use common language around costs and charges will make it easier for consumers when they shop around.”
