Wed, 09 Jul 2025

Wed, 09 Jul 2025 Mortgage lending rules change could help first-time buyers

The Bank of England has recommended a looser cap on riskier lending.

* The Bank of England recommends a looser cap on riskier lending, allowing individual banks and building societies to issue up to 15% of new mortgages at higher than 4.5 times loan-to-income.
* This could give first-time buyers more access to mortgages, with an estimated 36,000 new higher loan-to-income mortgages per year.
* Nationwide welcomes the move, saying it will boost housebuilding and the economy.
* However, millions of existing mortgage-holders face an average £107 rise in their monthly payments as their current deals expire over the next three years.
* Around 2.5 million households (28% of mortgage holders) will see their bills fall in the next three years due to falling interest rates.
* The global financial system is becoming more unstable, with changes to the US dollar and a rise in investors hedging against a weak dollar.
* The Bank notes that while there has been little direct impact on British households and companies so far, some significant changes are occurring globally.
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