FCA Sets Out Plans for Reform of Mortgage Market

The Financial Conduct Authority (FCA) has outlined plans to reform the mortgage market, which could make it easier for first-time buyers and self-employed people to purchase properties. The reforms also aim to help homeowners access housing wealth in later life.

The FCA will focus on four areas:

• First-time buyers and underserved consumers: Simplifying mortgage rules to allow more flexible products that reflect different working patterns and income levels at different stages of life;
• Later-life lending: Reviewing retirement interest-only requirements to make them more accessible. Exploring ways to improve advice to help people confidently plan for later life. Conducting a focused market study to ensure the lifetime mortgage market can meet the changing needs of future customers;
• Innovation and disclosure: Encouraging the use of data and technology, such as AI, to help brokers give better and faster advice while keeping a human touch. Looking at ways to make advertising and disclosure rules simpler, so consumers can understand information online more easily;
• Protecting vulnerable consumers: Working with partners to support people affected by financial abuse and help those using a mortgage to manage or consolidate debt.

The FCA will start to consult the public on proposed rule changes in the four areas from early 2026 and aim to have the first rule changes in place later that year.

The FCA's focused market study on how the later-life lending market could develop will be forward-looking and consider how the FCA can support the market to adapt and innovate, so consumers can access fair-value products that meet their needs. Terms of reference will be published in the first quarter of 2026.