In summary:

• The FCA is proposing changes to mortgage rules that could make it easier for more people to borrow
• Lenders may be able to take a more flexible, tailored approach to applications
• First-time buyers, self-employed people, older homeowners and those with past credit issues could all benefit
• But nothing is finalised, and the changes are currently just proposals

The Financial Conduct Authority (FCA) sets the rules that banks and lenders must follow, including how mortgages are assessed. So when the FCA proposes changes, it can shape who can borrow and how.

In December 2025, the FCA shared plans to reform the mortgage market, with the aim of better reflecting how people live and work today.

If approved, the changes would give lenders more flexibility to look at individual circumstances and offer mortgage options that better suit people’s needs, while still keeping strong protections in place.

What is changing in the mortgage market?

The FCA’s Mortgage Rule Review is open for consultation until 28 July 2026, so nothing is confirmed yet. But if the proposals go ahead, they could change how mortgage applications are assessed.

Here are some of the key changes being considered:

Greater flexibility for people with variable incomes

Lenders may find it easier to work with people whose income isn’t fixed. This includes freelancers, self‑employed workers, or those paid in a different currency.

A fairer look at affordability

Rather than rejecting applications based on past credit issues alone, lenders could take a broader view of your overall financial position.

More options for older homeowners

Updated guidance could make it easier for older homeowners to access retirement interest-only mortgages and unlock equity tied up in their home.

More flexibility with interest-only mortgages

Lenders may have more freedom to offer interest-only or part interest-only mortgages. In most cases, you’d still need a clear plan to repay the loan.

Why are these changes being proposed?

The proposals are part of the FCA’s wider aim to make managing money simpler and improve access to financial products.

The regulator has already introduced the Consumer Duty, which puts greater responsibility on lenders to act in their customers’ best interests. The Mortgage Rule Review would build on this, helping more people access mortgages while keeping safeguards in place.

What do the experts think?

Our mortgage expert, Matt Smith, says: “It’s encouraging to see the FCA looking to widen access to mortgages while keeping strong consumer protections in place. The fact that around 99% of mortgages taken out since stricter rules were introduced in 2014 are not in arrears gives confidence there is room to responsibly expand lending. These proposals are positive in their intent, particularly in recognising the needs of groups like first-time buyers, the self-employed and retirees.

“As these changes are largely permissive rather than prescriptive, their impact will depend on how simple they are for lenders and brokers to implement in practice. Recent changes to loan-to-income limits and stress testing are examples of how simple, easily adopted adjustments can quickly lead to real outcomes for buyers. For consumers to genuinely benefit, any new flexibility needs to be just as straightforward to apply and embedded into everyday lending processes.”

What could this mean for first-time buyers?

If the changes are approved, it could become easier for first-time buyers to access mortgages to buy their first home.

Lenders may feel more confident looking beyond past credit issues and focusing on your current financial situation. You could also see a wider range of mortgage options becoming available.

You’ll still need to show that you can comfortably afford repayments should interest rates rise.

Find out more about getting a mortgage when you’re a first-time buyer.

What could this mean if you’re self-employed?

If your income changes from month to month, these proposals could work in your favour.

Lenders may be able to assess your earnings more flexibly and take irregular income into account. Over time, this could lead to more mortgage products designed with self‑employed buyers in mind, including options with more flexible repayments.

Find out more about getting a mortgage when you’re self-employed.

What could this mean for older borrowers?

For older homeowners, the proposed changes could make interest-only mortgages more accessible.

With more flexibility in how lenders assess applications, it may be easier to release equity from your home without needing to sell or move.

What could this mean if you’re moving soon?

If you’re planning a move, these changes could affect you in a few ways.

On one hand, mortgages becoming available to more people could increase demand from buyers. On the other, a wider choice of deals could help improve affordability.

You might also find that lenders take a more tailored approach to your application, looking at your overall situation rather than just set criteria.

Will it make mortgages easier to get?

For some people, yes – but not for everyone.

The aim is to make mortgage lending more flexible and better suited to modern lifestyles. That could open the door to more borrowers, but lenders will still carry out checks to make sure mortgages are affordable and sustainable.

Strong protections will remain, and lenders will continue to assess risk carefully.

You can use our Mortgage Calculator to get an idea of what you might be able to borrow.

What happens next?

At this stage, the proposals are not final. The consultation runs until 28 July 2026. After that, the FCA will review feedback and decide whether to move forward with the changes, and how they should be introduced.

Rightmove is not authorised to provide financial advice. The information and opinions in this newsletter are for general information purposes only and should not be relied upon when making financial decisions. You should seek advice from a regulated mortgage adviser.

Your home may be repossessed if you do not keep up repayments on your mortgage.

Rightmove Financial Services Limited is authorised and regulated by the Financial Conduct Authority.