Regulators drop the per-lender cap on high loan-to-income mortgages from 28 October

The Prudential Regulation Authority and the FCA published final rules on 14 October 2026 removing the 15% cap on each lender's share of high loan-to-income (LTI) mortgages. The Financial Policy Committee's 15% limit stays, but now applies to the market as a whole. The changes take effect on 28 October 2026.¹

A high LTI mortgage is one of more than 4.5 times the borrower's income, or joint income. Each lender's share will be measured over a rolling four quarters.¹

Smaller lenders stay exempt: those that, across two consecutive four-quarter periods, lent less than £150m or wrote fewer than 300 regulated mortgages. Further advances and retirement interest-only mortgages are excluded from the limit.¹

The PRA's rules apply to firms in the housing part of its rulebook. The FCA's new guidance, FG26/11, covers FCA-authorised mortgage lenders outside the PRA's remit and replaces three earlier sets of guidance.²

If high LTI lending across the market runs above 15%, the regulators "may expect firms to gradually reduce their share of high LTI lending back towards 15% in a smooth and predictable way". Lenders above the exemption threshold are expected to watch the published total and be ready to adjust.¹

For brokers, that means a lender's appetite for loans above 4.5 times income could move with the market total, not just its own book.

The PRA will publish the market-wide share of high LTI lending each quarter, alongside the volume of mortgages in scope. The first figure, for the third quarter of 2026, is due in the fourth quarter.^1,3