FCA proposes changes to widen mortgage access

The Financial Conduct Authority (FCA) has outlined plans to widen access to mortgages for groups including first-time buyers, older borrowers and self-employed people.

Proposals include expanding access to interest-only and part interest-only loans, easing later-life borrowing rules and encouraging lenders to assess applicants based on their current financial circumstances rather than relying heavily on past credit issues. The regulator said the changes could help creditworthy but underserved borrowers access homeownership while maintaining safeguards introduced after the 2008 financial crisis.

The proposals are part of the FCA’s ongoing work to help consumers navigate their financial lives and support growth. In December 2025 it set out its plans to drive reforms to the mortgage market to better meet the needs of consumers today.  

The FCA has raised standards across the mortgage market over time, including through the Consumer Duty. The proposals build on that foundation – rebalancing risk to help more people access mortgages while keeping appropriate safeguards in place, including supporting consumers in understanding their options. 

As part of gathering feedback on the proposals, the FCA is using an online tool to hear directly from consumers about their experiences of the mortgage market. Alongside feedback from firms and others, this will help make sure consumers’ voices help shape the FCA’s approach.  The FCA is encouraging consumers, firms and all interested parties to respond to the consultation and share their views by 28 July 2026.

David Geale, Executive Director for Payments and Digital Finance at the FCA, said “We’re living longer and how many people work has changed. Our mortgage rules need to keep pace so those who can afford to repay can borrow. Stronger protections mean we can now safely widen access to mortgage borrowing for those that may be underserved.”  

The Building Societies Association (BSA) has welcomed the FCA’s Mortgage Rule Review proposals, stating that it was pleased to see the FCA’s proposals to widen access to part interest‑only lending, remove unnecessary barriers to retirement interest‑only mortgages, and increase flexibility for borrowers with variable or irregular incomes; areas where the BSA has repeatedly called for changes to reflect how people increasingly live and work today. 

Paul Broadhead, Head of Mortgages & Housing at the BSA, said “The FCA proposals are a welcome step towards a more dynamic, accessible and inclusive mortgage market. Building societies are already innovating to provide flexible, people-first mortgage products, and we are pleased that the proposals show clear support for future innovation and flexibility. 

“We will be working with members and the FCA to ensure that the proposals will deliver the intended objectives and give lenders the confidence to continue to innovate responsibly to support more people into homeownership.”