Overview
- The Financial Conduct Authority published a consultation on mortgage rule changes on Monday and is taking responses until 28 July 2026.
- One key proposal would remove the need for a borrower to show a credible repayment strategy when the interest-only portion is under 25% of the property valuation, which would make part interest-only loans easier to offer.
- The FCA would revise guidance for retirement interest-only lending and relax joint retirement mortgage rules so older homeowners can more easily release housing wealth with tailored follow-on products as repayment options.
- Regulators want lenders to use individualised affordability checks that reflect current income, permit flexible repayments for variable or self-employed incomes, and consider applicants paid in foreign currency.
- The FCA says the changes build on post‑2008 and 2014 safeguards and have won broad support from industry groups, but commentators warn that limited housing supply and the need for deposits will still restrict how many people can buy homes.