Boost for First-Time Buyers as ‘Mortgage Lending Reins Loosened’
GREATER LONDON, ENGLAND, JUL 9 – The Bank of England permits lenders to exceed 15% individual high loan-to-income mortgage limits, potentially helping 10,000 more first-time buyers annually, while maintaining a 15% aggregate cap.
- On Wednesday, the Bank of England announced it will allow lenders to disapply the 15% cap on mortgages with an LTI ratio of 4.5× income or higher, easing borrowing restrictions.
- In response to deposit and affordability pressures, the FPC recommended that lenders exceed the 15% high LTI lending cap while maintaining an overall market limit to support first-time buyers.
- Bank of England data show high-LTI mortgages rose to 9.7% in Q1 2025 and are forecast to reach 11%, potentially enabling 36,000 more loans annually, according to Sam Woods.
- Following the BoE's move, lenders can now offer more high-LTI mortgages, enabling an estimated 10,000 additional first-time buyer loans annually, according to Nationwide.
- The PRA's temporary LTI rule runs until June 2026, with plans for a consultation on permanent changes that could revoke or revise the limit, as the BoE forecasts a rise to 11% of high-LTI mortgages in 2025.
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The VVD party proposes allowing first-time buyers to save tax-free for their first home purchase. Participants in the proposal are divided on this plan. Just over half consider this a good way for young people to secure a home.

Boost for first-time buyers as ‘mortgage lending reins loosened’
One mortgage expert said the Bank of England had made a ‘welcome and pragmatic move’.
Bank of England eases mortgage lending rules t
The Bank of England (BoE) has announced changes to its mortgage lending regulations, allowing British banks and building societies to issue a higher volume of potentially riskier mortgages. The move is aimed at supporting the government’s efforts to boost home ownership, particularly for first-time buyers. Under the new rules, individual lenders will have flexibility to exempt borrowers from loan-to-income limits introduced after the 2008 financ…
With the first reduction of ECB rates already executed and new reductions on the horizon, the mortgage machinery begins to give signs of reactivation. Real Estate Credit Union (UCI)...
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