Regulatory Alerts2026-07-28
Added · Updated
CP26/18: Mortgage rule review – supporting first-time buyers and underserved consumers
The Financial Conduct Authority proposes removing the requirement for a credible repayment strategy where the interest-only portion of a mortgage is less than 25% of the lender's valuation. For interest-only amounts between 25% and 50% of valuation, the evidential provision regarding the potential to purchase a cheaper property would not apply, while amounts over 50% remain subject to this provision. The proposals also add the use of follow-on mortgage products and conversion to repayment as examples of credible repayment strategies, and allow lenders to use tailored interactive dialogue to assess credibility when evidence is not reasonably available. These changes apply to first charge interest-only and part interest-only/part repayment mortgages and are open for consultation until 28 July 2026.