You may have noticed something surprising lately.
After a couple of years of tighter borrowing limits and cautious lending, some buyers are finding they can borrow a little more than they expected. Agreements in principle are coming back higher. In some cases, income multiples are edging up again. Stress rates don’t feel quite as punishing.
So, are lenders quietly relaxing the rules?
Not exactly, but something has shifted.
The Framework People Often Confuse
A lot of headlines talk about “affordability tests” as if one single rule was switched on or off. In reality, it’s more layered than that.
A few years ago, the Bank of England removed its system-wide “FPC affordability test” recommendation, a market-wide resilience rule designed to strengthen the mortgage system after the financial crisis.
Lenders still have to meet the FCA’s borrower-level affordability rules. That means they must check you could afford your mortgage if rates were to rise. Those checks haven’t disappeared.
What changed wasn’t the need to test affordability. It was how tightly that test is defined.
The FCA doesn’t set a single fixed stress rate for all lenders. Firms have flexibility in how they design their tests, but they still must assess affordability against plausible future rate rises. In practice, that usually means building in a minimum uplift above the actual deal rate.
What’s Actually Happening Now?
During the peak-rate period, lenders were stress-testing mortgages at very high assumed rates. Even if you were applying for a competitive deal, you still had to prove you could afford repayments significantly above what you’d actually pay.
As rate expectations have steadied, some lenders have adjusted their stress assumptions. A few have also increased income multiples for specific borrowers, including certain first-time buyer products, which can increase borrowing capacity in practical terms.
That doesn’t mean lending has become careless. It means affordability models are responding to today’s conditions rather than last year’s uncertainty.
For some buyers, that shift can make a noticeable difference to how much they qualify for.
More Generous Or Just More Realistic?
It’s easy to interpret higher borrowing figures as “looser lending.” In most cases, it’s better described as recalibration.
Lenders are still reviewing income, outgoings, credit history and long-term affordability. The core checks haven’t disappeared. What has changed is the size of the cushion built into the stress test.
When rates were moving quickly, lenders built in a larger buffer. Now that things are more stable, that buffer doesn’t need to be quite as extreme.
What This Means For You
If you looked at your borrowing position 12–18 months ago and the numbers didn’t work, it may be worth revisiting. We’re seeing cases where affordability outcomes are different compared to last year.
That said, borrowing capacity and borrowing comfort aren’t the same thing.
The key question isn’t just “what’s the maximum?” It’s whether the repayment feels sustainable if circumstances change, whether that’s rates, income or life in general.
Affordability tests are designed to protect lenders. A sensible mortgage plan is designed to protect you.
If you’d like to sense-check your current position or see what’s possible under today’s criteria, we’re always happy to run the numbers and explain it clearly. Just give us a call on 020 8366 4400 or email enquiries@cedarhfs.co.uk to discuss it further.