The Bank of England’s Prudential Regulation Authority (PRA) and the Financial Conduct Authority (FCA) finalised new rules on October 14, 2026 that remove the firm-by-firm limit on high loan-to-income (LTI) mortgage lending, with the new framework taking effect on October 28, 2026. Since 2014, each individual lender had been capped at putting no more than 15% of its new residential mortgages into high-LTI loans — defined as lending at or above 4.5 times a borrower’s individual or joint income. Under PS19/26 and FG26/11, that per-lender ceiling is gone; in its place is a single market-wide aggregate limit of 15%, so any one lender can exceed 15% as long as the industry total stays within bounds.
The change affects anyone close to the edge of standard affordability limits — typically first-time buyers and higher earners in expensive regions, where borrowing above 4.5 times income is often the only way to clear local asking prices. A 2025 relaxation had already let individual lenders exceed 15% provided the market-wide share held; banks’ combined share of high-LTI lending reached 9.7% in the first quarter of 2025, still below the old ceiling.
The 4.5-times-income threshold itself has not moved — some respondents in the regulators’ consultation argued it no longer reflects current prices and should rise toward 5 times, but PS19/26 and FG26/11 keep the multiple unchanged. The practical effect for borrowers is about which lenders will now compete harder for high-multiple business, not a change to how much any individual applicant can borrow against their income.
References
Bank of England PRA – PS19/26: High Loan to Income Lending / FCA – FG26/11: The Financial Policy Committee’s Recommendation on Loan to Income Ratios in Mortgage Lending
