Guernsey regulator launches regulatory framework for equity release products

The Guernsey Financial Services Commission has unveiled a new regulatory framework ahead of regulated equity release products being rolled out in in the Bailiwick.

The rules were developed following a recent consultation and will come into effect at the start of 2026 when the amendments to the Bailiwick of Guernsey’s Lending, Credit and Finance Law 2022 are enacted.

Guernsey’s new regulatory framework will mirror the UK’s regime, shaped by the Financial Conduct Authority’s rules and the Equity Release Council’s member standards, and will include five product standards:

• Interest rates – These must be fixed or if variable, capped for the life of the loan.
• Home for Life – Customers must have the right to live in their property for the remainder of their life, or until they permanently move into care.
• Option to move home – Customers must be allowed to move to a suitable alternative property and ‘port’ their lifetime mortgage if they meet lender’s criteria.
• No Negative Equity Guarantee – If the terms and conditions of the loan are met, the borrower or their estate will never owe more than the property is worth.
• Ability to make repayments – Customers must have the ability to make repayments without incurring any charges, subject to lending criteria of the provider.

UK equity release firms authorised by the FCA will be able to offer equity release products into the Bailiwick market under equivalence arrangements from 1 January 2026.

Jeremy Quick, director of banking and insurance division at the commission, said: “The equity release framework is a crucial first step towards these products becoming available locally. We are confident we have created a framework that is attractive to new market entrants.

“Clearly, much will depend on consumer demand and equity release providers’ appetite to enter the market here. The consumer protections we’ve introduced within the regulatory framework will mean that when the time comes, homeowners can enter into these arrangements with confidence.”

Kelly Melville-Kelly, director of risk, policy and compliance at the council, added: “The council’s product standards provide people across the UK with the confidence to explore their choices when it comes to accessing housing equity and the fact they have served to inform the commission’s approach highlights their value in supporting market growth.”