Amendments to PRA Rulebook and FCA guidance on LTI flow limit in mortgage lending

FCA Publications

Published April 1st, 2026

Detected April 1st, 2026

Summary

The FCA and PRA are consulting on proposed amendments to the loan to income (LTI) flow limit rules for mortgage lending. Following a recommendation from the Financial Policy Committee (FPC), the proposals would allow individual lenders to increase their share of high LTI lending while maintaining the aggregate 15% limit. Comments on CP26/12 are due by 1 July 2026.

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What changed

The Financial Policy Committee recommended in July 2025 that the PRA and FCA amend implementation of the LTI flow limit to allow individual lenders flexibility in their high LTI lending share while ensuring aggregate flows remain consistent with the 15% cap. The PRA proposals apply to all PRA-authorised mortgage lenders and their subsidiaries; FCA proposals cover FCA-authorised mortgage lenders not owned by PRA-authorised firms.

Mortgage lenders should review the proposed amendments and submit comments by 1 July 2026 to the PRA at the address provided. This consultation forms part of the wider mortgage rule review and feedback will shape future mortgage requirements. Firms should assess how the proposed changes to LTI flexibility might affect their lending strategies and compliance obligations.

What to do next

Review CP26/12 proposed amendments to LTI flow limit rules
Assess impact on current mortgage lending practices and compliance procedures
Submit comments to PRA by 1 July 2026 via email or post

Source document (simplified)

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CP26/12: Proposed amends to PRA Rulebook and FCA Guidance concerning the Loan to Income flow limit in mortgage lending

Consultation opens 01/04/2026 01/04/2026 Consultation closes 01/07/2026

Consultation papers First published:

01/04/2026

Last updated: 01/04/2026
We are proposing changes to the Prudential Regulation Authority's (PRA) and FCA's loan to income (LTI) rules for mortgages.

Read CP26/12 (PRA 6/26)

Why are we consulting

In July 2025, the Financial Policy Committee (FPC) recommended the Prudential Regulation Authority (PRA) and FCA amend implementation of its loan to income (LTI) flow limit to allow individual lenders to increase their share of high LTI lending while aiming to ensure the aggregate flow remains consistent with the 15% limit.

We and the PRA are consulting on proposed amendments to the PRA's Rulebook and the FCA’s general guidance following the FPC's recommendation.

The PRA proposals apply to all PRA-authorised mortgage lenders and their subsidiaries, while the FCA proposals cover all FCA-authorised mortgage lenders not owned by PRA-authorised firms.

This consultation is part of our wider review of mortgage rules. The LTI flow limit plays an important role in protecting borrowers and financial stability, while still allowing creditworthy households to access home ownership. Reviewing how the LTI framework operates will help ensure our guidance is clear, proportionate and fit for today’s market. Feedback from this consultation will help shape our mortgage requirements and improve outcomes for homeowners.

Who is this consultation aimed at?

This consultation will be of interest to the following:

banks
building societies
friendly societies
industrial and provident societies
credit unions
PRA designated investment firms and overseas banks in relation to their UK branch activities PRA rules also require relevant firms to apply the rules at UK subsidiary level to firms not already caught by the rules

Next steps

We want to know what you think of our proposals and welcome comments via email by 1 July 2026. The PRA is accepting responses on behalf of both the FCA and the PRA and both authorities will consider the responses received.

Responses can be sent by email to: [email protected]

Alternatively, please address any comments or enquiries to:

Macroprudential Toolkit Team, Prudential Policy
Prudential Regulation Authority
20 Moorgate
London
EC2R 6DA.

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FG25/4: Amendments to PRA Rulebook and FCA Guidance concerning the de minimis threshold for the Loan to Income flow limit in mortgage lending FS25/6: Mortgage Rule Review: Feedback to DP25/2 and Roadmap