Since the 11th of July 2025, restrictions around high LTI mortgages were loosened. Up until now, any lender writing more than £100 million in new residential mortgages over a rolling year had to keep the share of loans above 4.5x income at no more than 15%.
The cap was designed to keep risk in check, but in reality, it tied the hands of some lenders who wanted to do more for borrowers with strong incomes but smaller deposits.
From July, that threshold rose to £150 million. Lenders under that level won’t be bound by the cap anymore, giving smaller players more freedom to approve higher-income-multiple-loans. While the changes won’t hugely impact larger lenders, who typically write the bulk of residential lending, the shift could still influence how they price or position their products in response to increased competition.
It’s a technical shift, but the effect could be real for first-time buyers and the brokers advising them.
The PRA is giving larger lenders the chance to apply for a modification by consent. In practice, this means they can temporarily go over the 15% cap as long as they report carefully and the overall market share of high-LTI loans doesn’t climb above 15%.
This arrangement is set to run until 30th June 2026, unless new rules are introduced sooner. So while the formal change began in July, lenders may have already started adjusting their affordability checks or product ranges.
For clients - but particularly first-time buyers - this change could help open doors.
In short, people who’ve been told no in the past might now find they have an option, including those in high-cost areas or with strong incomes but limited deposits.
For brokers, this shift creates new conversations and an opportunity to revisit clients who you may not have been able to help previously. Clients who couldn’t borrow enough under the previous rules may now qualify for the loan amount they require, which opens up doors for a large portion of brokers’ clients or lead lists.
With these changes in mind, the value of a broker’s advice is key. It’ll be important to help clients understand the long-term impact of borrowing more, as well as stay up to date with policy changes throughout the rest of the year and into 2026. Be sure to compare lender approaches carefully, too, since criteria will vary.
The regulation itself is technical, but your client updates don’t need to be. A short, simple post on Facebook or Instagram is enough to start a conversation.
Here are two quick ideas:
Post example:
“From July 2025, some lenders may be able to lend you more based on your income. This could help first-time buyers borrow enough to get on the ladder. Want to see if this could work for you? Get in touch.”
Instagram Story poll:
“Would a bigger borrowing limit help you buy sooner?”
A) Yes
B) No
C) Not sure — need advice
If you’re not confident in creating posts or graphics, our blog on how to build an engaging Facebook and Instagram post gives you a simple, step-by-step guide.
This rule change won’t transform the market overnight, but it creates fresh opportunities for buyers and brokers alike. By explaining the rules in simple language, you can show clients you’re on top of the latest developments and are ready to guide them.
Even a quick social post or email update can reassure people who thought they were stuck, kickstart conversations with new leads and reinforce your role as a trusted adviser.
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