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The Independent: Will relaxed mortgage lending regulations make it easier to get on the property ladder?

Journalist: Marc Shoffman, Freelance

ended 09. July 2025

Hi

I am writing a peice for The Independent looking at the FCA's discussion paper on relaxing mortgage lending rules.

It wants to look at the:

  • Potential to update responsible lending rules to support wider access to sustainable home ownership.
  • Ensuring the regulatory framework and the market are prepared for the likely future increases in demand for later life lending.
  • Introducing more flexibility to promote consumer understanding, information needs, and innovation.
  • Rebalancing the collective risk appetite in mortgage lending.

I am keen for comments on the pros and cons of this. 

Will it become easier to get on the property ladder? 

Could it mean buyers are left with debts and homes they eventually may not be able to afford? Are we risking a repeat of the 2008 financial crisis or what is different this time?

Kind regards

Marc

9 responses from the Newspage community

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Riz Malik
Independent Financial Adviser at R3 Wealth
First time buyers need help but not at any costs. Lending them more today might get them on the ladder but it is not helpful if that mortgage then becomes a noose and you end up living to pay your mortgage if rates rise in the future.. Just because a lender may give you a large mortgage doesn’t mean you should take every penny they are prepared to lend and inexperienced borrowers need to be made aware of this.
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Samuel Mather-Holgate
Managing Director & IFA at Mather and Murray Financial
The expectation from this paper is that borrowing money will become easier, due to the increased length of time that a mortgage can be paid back. Lessons from Japan, where mortgages are passed down along with the property as prices are so high. Ensure afforability is key, and that the relevant monthly repayments can be made. It shouldn't matter what term this is over. This will also effect the later lending market, which currently doesn't know what rules to follow as some applications will fall into the current mortgage rule book, and others into equity release where afforability sometimes doesn't have to be assessed at all.
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Michelle Lawson
Director at Lawson Financial
This is welcomed if done in the right way. We need a Goldilocks reform to make it just right. The recent economic crisis demonstrated that, whilst is pain felt after years of low interest rates, the background stress testing largely was successful. There are several ridiculous anomalies that can be ironed out to make things easier and more flexible but caution should be shown to not go too far otherwise we are at risk of undoing the work that has been done. Product innovation and common sense are just needed.
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Mike Staton
Director at Staton Mortgages
I am eager to see the Mortgage lending rules join the current decade. Regulations are set so far back in time that it makes it nearly impossible for first time buyers to get on the property ladder. We are currently seeing a generation of renters who just can not get into a position to be able to buy their first property. Whilst regulations are there to protect both the industry and the economy, they are also open to interpretation and a lot of lenders have often used them as a curtain to hide behind when declining a borderline mortgage. The current system is broken, leaving thousands of people no option to buy a property, when you combine this with the current goverments seeming inability to grasp basic economics, the current crop of first time buyers seem destined to be the next generation of renters.
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Harry Goodliffe
Director at HTG Mortgages
More flexible lending rules could give renters a real shot at homeownership but only if we tread carefully. This isn’t about handing out oversized mortgages, it’s about making the system work better for real people. With today’s tighter regulation, there’s room to tweak without triggering another 2008, but we can’t afford to get complacent. Balance is key.
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Pete Mugleston
Mortgage Advisor & Managing Director at onlinemortgageadvisor.co.uk
This proposal is a positive step, but only if it balances innovation with protection. Looser rules should make it easier for first-time buyers, for example, to get on the property ladder. But improved access to the market shouldn't weigh down borrowers over the long term. If lenders go too far and stretch borrowers' finances, we risk a repeat of the pre-2008 lending culture. Regulatory oversight is better now, as are affordability checks, but any reform must ensure these remain robust. Greater flexibility and clearer communication will help consumers understand their commitments, but safeguards must stay in place to avoid overstretching and protect both borrowers and the market.
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Rob Peters
Principal at Simple Fast Mortgage
It is a fine line to walk. Relaxing rules could open the door for many who currently can’t get on the property ladder, but we must tread carefully.

Greater flexibility in lending can encourage innovation and expand options, but it also brings risks if we don’t keep affordability and long-term sustainability at the forefront. The key is balancing innovation with responsible lending, ensuring people don’t overcommit and face financial hardship down the road.
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David Stirling
Independent Financial Adviser at Mint Wealth
Easier mortgages may equal harder landings. Loosening lending could come with a financial hangover and leave borrowers overstretched. However, there is a real opportunity for the FCA to modernise mortgage regulation to reflect today's demographics and economic realities. This access to borrowing needs to be balanced with resilience - who realisitically wants to be paying their mortgage at 80?
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Sean Horton
Managing Director at Respect Mortgages
These proposals could genuinely help creditworthy borrowers, particularly first-time buyers facing deposit hurdles. However, we're not seeing reckless lending like 2008 - today's market has robust consumer protections and historically low default rates.

Execution-only could make sense for straightforward remortgages where borrowers know exactly what they want.

But here's the rub - mortgages aren't like buying car insurance online. These are quarter-million-pound decisions with decades-long consequences.

Most people overestimate their mortgage knowledge whilst underestimating the complexity.

A middle ground allowing execution-only for simple product transfers or remortgages could work, but full house purchases? That's risky territory.

The real benefit lies in removing unnecessary advice barriers for straightforward cases whilst supporting lending into retirement. Yes, there's slightly increased risk, but the FCA acknowledges defaults may rise modestly from current ultra-low levels.