August 7, 2018
This report suggests that the UK’s Equity Release sector is in deep trouble, with the regulator having missed opportunities to effectively manage the risks in the sector.
“Asleep at the Wheel: The Prudential Regulation Authority and the Equity Release Sector” reveals that firms are greatly under-valuing their No Negative Equity Guarantees – guarantees that ensure that borrowers’ debt can never exceed the value of the mortgaged property. These problems have been well-known to the regulator, the Prudential Regulation Authority, for years and the report argues that the regulator has knowingly allowed firms to use valuation methods that are unfit for the task. Questions must now arise about the Prudential Regulation Authority’s capacity to regulate the industry competently.Read Full Report