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Welcome to our weekly newsletter | |
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🏡 August 2025: Lending Reforms Open Doors for Home-buyers & Remortgages | |
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🔍 Lending Rules Just Changed — Here’s What It Means for You
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📢 Key Regulatory Reforms Now in Effect ✅ On 22 July 2025, the Financial Conduct Authority (FCA) published Policy Statement PS25/11, introducing major flexibility for homeowners and buyers: - No longer a requirement for regulated advice when switching mortgage products
- No full affordability reassessment needed when changing terms or remortgaging without additional borrowing
| | ✅ The Bank of England and Prudential Regulation Authority (PRA) updated their Loan-to-Income (LTI) cap rules: The 15% limit on high-LTI loans (over 4.5× income) no longer applies to lenders issuing under £150 million annually Up to 36,000 more high-LTI mortgages expected to be approved per year Major lenders including Santander, Barclays, and Nationwide are already reflecting these changes in their lending criteria | | | |
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🔍 Lending Reforms: Key Changes at a Glance | Feature | Before | Now | | ✅ Borrowing Power | ~£240K on £60K income | Up to £270K+ (4.5×) | | 💷 Deposit Needed | ~£58K | As low as £45K | | 📄 Remortgage Rules | Full affordability recheck | No recheck if no extra borrowing | | 🏦 Access to Lending | Limited by LTI caps | Wider eligibility, especially for professionals | | |
💡 Real-World Example A first-time buyer earning £50K with a 10% deposit can now borrow up to £225K–£230K, compared to just £190K under the previous lending cap.
👉 That’s the difference between a flat and a house in many UK cities.
📈 Market Snapshot – August 2025 -
🔼 41,800 remortgage approvals in June – the highest since late 2022 -
📉 Average five-year fixed mortgage rates have dropped to 4.3%, reflecting increased lender competition | |
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💬 How Can Mortgage Circle Help You? At Mortgage Circle, we specialise in making these policy changes work for you. Our team offers: ✅ Tailored advice based on your goals and income ✅ Exclusive access to specialist lenders and packager-only deals ✅ Support for complex cases, including self-employed, contractors, and portfolio landlords ✅ Fast and efficient application process to help you move quickly in a shifting market 🧠 Client Insight "We helped a client remortgage without needing to resubmit income evidence, saving them over £3,000 a year. These rule changes are a game-changer” | |
⚠ FCA Risk Warnings & Compliance Your home may be repossessed if you do not keep up repayments on your mortgage. Not all Buy-to-Let mortgages are regulated by the Financial Conduct Authority. This newsletter is for general guidance only and does not constitute financial advice. Please speak to an adviser for personalised recommendations. Mortgage rates, criteria, and product availability can change at short notice. Mortgage Circle is directly authorised and regulated by the Financial Conduct Authority (FCA No. 797652). | |
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📞 Ready to Explore Your Options? We’d love to help you take advantage of these lending reforms. 📞 Call us: 0121 572 0675 / 0800 644 0190 🌐 Visit: www.mortgagecircle.co.uk 📧 Or simply reply to this email and one of our expert advisers will be in touch | |
Warm regards, The Mortgage Circle Team | |
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