Mortgages: FCA Proposes More Support For Borrowers

First-time buyers, older borrowers and self-employed people could get more support to access mortgages under new rules proposed by the Financial Conduct Authority (FCA).

The mortgage market overhaul would give lenders more flexibility to consider individual circumstances and develop financial products to meet the needs of borrowers.

What is the FCA proposing?

Some of the key measures the FCA is proposing include:

• More flexibility: barriers for lenders to offer flexible repayments for people with variable income, like the self-employed, and lend to those paid in foreign currency.
• More affordability: encouraging lenders to assess affordability based on a person’s full and current situation, rather than automatically excluding people because of minor or past credit history issues.
• Widening age ranges: making it easier for older homeowners to unlock wealth built up in their property by updating affordability guidance for retirement interest-only mortgages.
• Overhauling interest-only mortgages: updating rules on interest-only (or part interest-only) mortgages to give lenders more flexibility. The rules will also ensure most borrowers have a clear plan to repay (unless they’re borrowing a smaller amount).

Why is the FCA proposing the change?

The proposals form part of the FCA’s ongoing work to help customers manage their financial lives.

In December 2025 the financial regulator set out its plans to drive reform to the mortgage market to ensure it is fit for purpose in today’s age.

The consultation will remain open until 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.”

OPINION: What could this mean for you?

The FCA’s proposed mortgage market overhaul is a step in the right direction to ensure that the product is meeting the needs of borrowers.

The financial landscape has changed significantly over the past 30 years and the mortgage market must remain dynamic to accommodate the way we live today.

Lenders need the flexibility to tailor mortgage deals and affordability testing to accommodate the evolving range of careers people undertake and increasing life expectancy.

This could lead to more tailored mortgage offers that still protect borrowers while allowing them to access the finance they need to get on to the property ladder or move later in life.