IMLA welcomes FCA focus on advice and more realistic affordability cherry

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cherry

Joined 25/09/12
Posts 2655 – Message

IMLA welcomes the FCA’s intention to explore and consult on changes that would further support first-time buyers and currently underserved groups
The FCA’s openness to moving beyond blunt affordability rules towards a more nuanced ‘shape of affordability’ better reflects real borrower behaviour, lifetime income patterns and economic uncertainty
IMLA’s New Normal 2026/27 report shows the mortgage market is well placed to support this evolution, with falling arrears, strong intermediary involvement and resilient lending

Friday 19th December 2025, London

The Intermediary Mortgage Lenders Association (IMLA) has welcomed the Financial Conduct Authority’s (FCA’s) Feedback Statement and roadmap on DP25/2, describing it as a positive and constructive step towards widening access to sustainable homeownership while maintaining high standards of responsible lending.

IMLA said it was encouraged by the tone of the Statement, which reflects the wide range of views expressed by respondents and demonstrates a clear determination to strike the right balance between flexibility and prudence. In particular, the association welcomed the FCA’s focus on advice and its intention to explore changes that could better support first-time buyers and borrowers who have historically found it harder to access the mortgage market.

IMLA also welcomed the FCA’s recognition that traditional affordability approaches do not always reflect how people actually manage their finances over time. Moving towards a more nuanced ‘shape of affordability’, particularly in the context of later life borrowing, variable incomes and economic uncertainty, is seen as a sensible evolution that places advice firmly at the heart of good customer outcomes.

IMLA research underlines that the market is well positioned to support this direction of travel. Its New Normal 2026/27 report shows that mortgage arrears are projected to continue falling, lending remains resilient and around 87% of regulated mortgage lending is conducted through intermediaries, reinforcing the central role of advice in the market.

IMLA also noted that the FCA’s focus on underserved groups builds on long-standing industry discussion. Its report, Why underserved borrows should not rule themselves out, published in November 2021, highlighted that many households who could sustainably afford a mortgage nevertheless believe homeownership is out of reach. IMLA believes that greater flexibility, combined with high-quality advice, can help address that confidence gap.

Kate Davies, executive director of IMLA, said:

“This is a thoughtful and encouraging roadmap from the FCA. It’s clear they have listened carefully to the responses to the discussion paper and are genuinely seeking to strike the right balance between making some rules less rigid while continuing to support responsible lending.

“We’ve been talking for some time about the need to better serve groups who may assume a mortgage isn’t for them, when in fact it could be. With good advice and a more realistic approach to affordability, the market is in a strong position to help more people explore their options.

“As we head towards the end of the year, it’s a welcome reminder that there are reasons to be positive about the mortgage market — and a good moment to encourage more people to speak to an adviser and see what might be possible.”

IMLA said it looks forward to engaging constructively with the FCA as consultations emerge over the coming months and into 2026.

And with Christmas approaching, IMLA added that helping more people feel confident about their housing options would be a welcome gift for borrowers and the wider market going into the new year.

Report Post 19 Dec 2025, 3.46 pm

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TH84

Joined 24/05/12
Posts 8139 – Message

I think the changes around affordability are silly.

The world went tits up in 2008. I remember LTVs being capped at 75%, trying to get a mortgage was near impossible etc.

During covid, after the mini budget, the world carried on as normal. Despite the jjump in rates, most people were able to manage. The exceptions being the people who had lost their jobs or had run up a load of debt after getting their mortgage.

So these rules were put in place protected people and the market as a whole - hoorah, it worked.

Great!

So what were going to do now is to roll it right back so people can get larger mortgages.

FCA are completely useless. Create more work for us, make lending riskier and charge us for the privilege.

Report Post 19 Dec 2025, 4.46 pm

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BoxFinPlan

Joined 05/05/15
Posts 6823 – Message

All good points.

But alas Common Sense doesn't apply.

Government wants to drive Consumer Demand - cheap borrowing does that

FCA wants to be seen as 'Consumer Friendly' - and when it goes wrong, there are lots of scapegoats (Advisers, Lender - but never the conumer).

Loss of job (or loss of income with children coming along/divource) should be the only reason a mortgage becomes non-affordable.

So, lets get back to proper lending at proper levels.

Yes - you can borrow at 6 x salary - if your salary is likely to increase 'above average' over a 5 or 10 year time period, stress tested at 7% pa - and with 25 year + terms to help on the repayement side.

If you can't pass that, you can't borrow that much.

Why not also a return of Professional Mortgages?

Resident Doctors see a 50% pay rise over the first 5 or so years (plus normal salary increases) - so 8 or 9 x their starting income is likely to be affordable, with a 5 year fixed rate.

But no - lets just let everyone borrow more.... and when it goes wrong, its someones else fault.

Report Post 19 Dec 2025, 7.43 pm

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