The Intermediary – September 2025 - Flipbook - Page 50
RESIDENTIAL
Opinion
Brokers back FCA
reforms, lenders
must step up
T
he mortgage market
is at a crossroads.
Borrowers’ lives are
more complex than
ever, yet too many
struggle to find
products which address and support
that complexity. The Financial
Conduct Authority’s (FCA) Mortgage
Rule Review has brought fresh energy
to the debate about how the industry
should evolve, and brokers are
sending a clear message: reform and
innovation cannot wait.
We recently surveyed 500 brokers
across the UK, and the findings were
striking. More than three-quarters
(78%) support the FCA’s review,
reflecting broad agreement that rules
must catch up with the realities of
modern borrowers.
Brokers are also calling for lenders
to act: 61% want new products that
beer support a wider variety of
borrower circumstances, while more
than half (52%) believe lenders are
simply too slow to innovate.
Changing landscape
It’s easy to see why. The neat categories
of employment and income that
once underpinned underwriting
have broken down. Today’s mortgage
applicants are far more complex
and include gig economy workers,
freelancers, entrepreneurs juggling
multiple income streams and
households that don’t fit traditional
structures. Yet what we hear from
brokers is that too many underwriting
models still rely too heavily on
rigid definitions of income and
affordability.
Brokers, who sit at the front line of
these complexities, know how oen
customers with perfectly manageable
finances are excluded because their
circumstances don’t fit outdated
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The Intermediary | September 2025
boxes. That’s why they are pushing
for more flexible lending, tailored
support for complex or vulnerable
borrowers and the use of technology
to streamline mortgage applications.
These measures are seen as critical to
modernising the sector and delivering
beer outcomes for all borrowers.
This isn’t about chasing trends or
stretching risk appetite. It’s about
recognising that the sector will
struggle to support the homebuyers
of tomorrow if it doesn’t adapt.
Brokers see this first-hand: customers
being turned away not because
they can’t afford a mortgage, but
because the system isn’t built to
accommodate them.
The role of the review
The FCA’s consultation offers a timely
opportunity to address these gaps. By
encouraging a broader approach to
affordability and promoting inclusive
product innovation, the review could
help reset expectations across the
market. But regulation can only go so
far. The real change has to come from
lenders themselves.
That means designing products
that serve people in non-standard
employment. It means embracing
underwriting processes that consider
multiple income sources. It means
using technology to simplify, not
complicate, the mortgage journey.
And it means working hand in hand
with brokers, whose expertise is
essential to navigating complexity
while maintaining consumer
protections.
One point must be crystal clear:
brokers are not just part of the system
– they are critical to the process
working successfully. As a 100%
intermediary-led building society, we
see daily how brokers bring clarity,
trust and choice to customers in an
AARON SHINWELL
is chief lending officer at
Nottingham Building Society
Too many [lenders’]
underwriting models still
rely too heavily on rigid
definitions of income”
increasingly complex market. That’s
why we oppose changes that fragment
trust, confuse roles or dilute the
role of advice. Brokers are critical to
ensuring customers not only find the
right product but also understand it.
Their role must remain protected in
the long term.
Time to act
Lenders now face a choice. They can
treat the FCA’s review as a compliance
exercise, tweaking processes while
leaving product design largely
unchanged. Or they can see it as an
opportunity to reshape the market
in ways that reflect the financial lives
people increasingly lead.
At Noingham Building Society,
we are choosing the laer. For us,
innovation doesn’t mean abandoning
prudence; it means finding new
ways to balance flexibility with
responsibility. It means designing
products that expand access without
creating risk for borrowers or the
wider system. It means partnering
with brokers to ensure the solutions
we develop genuinely meet
customer needs.
If we are serious about supporting
sustainable homeownership, we must
innovate – responsibly, collaboratively
and with brokers at the heart of the
process. That is the only way to build a
mortgage market that truly works for
today’s borrowers. ●
