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

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.