The number of borrowers switching to a new lender using modified affordability assessments more than doubled in the second half of 2025, according to data obtained by Stonebridge from the Financial Conduct Authority.
Between July, when the revised rules came into effect, and the end of December 2025, remortgages arranged with a new lender using modified affordability assessments rose 126% year on year to 9,664 from 4,275, according to FCA data released under the Freedom of Information Act.
By contrast, product transfers using modified affordability assessments edged up only slightly, from 269 to 290 over the same period. The number of lenders using the assessments increased sharply from eight to 12.
The rule changes introduced last summer widened the circumstances in which lenders can use modified affordability assessments. They can now be applied where a borrower wants to reduce their mortgage term, or where a remortgage with a new lender would be more affordable than either the borrower’s existing mortgage or a new deal offered by their current lender.
Stonebridge said the figures showed the changes were beginning to have an effect, but argued that take-up still remained modest relative to the potential size of the opportunity.
GAME-CHANGING OPPORTUNITY
Rob Clifford (pictured), chief executive of Stonebridge, said: “When the FCA made this change last summer, MAAs struck us as a boon for consumers but more must be done to help them take advantage. MAAs are a game-changing opportunity for many homeowners, giving them much greater flexibility to lower their borrowing costs.
“There are many circumstances where homeowners fear affordability tests and wrongly assume they must stick with their existing lender. This is where a mortgage adviser can really come into their own and it’s a huge opportunity with plenty of scope for many more borrowers to benefit.
“One of the ways they can do this is by making the most of their existing customer relationships and the data they hold on mortgage expirations. The trajectory of interest rates may be uncertain right now because of conflict but, as rates come down over the long term, guiding borrowers to better financial outcomes is going to become increasingly valuable to them.
“For many customers, taking the easy option and going direct to a lender without shopping around could prove to be a very costly mistake, and one they’re stuck with for years.”
AFFORDABILITY ASSESSMENTS
The data also suggests that borrowers using modified affordability assessments to move to a new lender tend to have larger loans and higher loan-to-value ratios than those staying put.
Stonebridge said the average median LTV for remortgages with a new lender completed under modified affordability assessments was 54.4% following the rule change. For borrowers remortgaging with their existing lender under the same framework, the equivalent figure was 25%.
Loan sizes also differed markedly. Borrowers moving to a new lender borrowed an average of £200,999, while those remortgaging with their current lender borrowed £95,488.
Clifford said the figures pointed to a continuing need for advisers and lenders to be more proactive in showing borrowers that they may still have options even if their financial circumstances have changed since taking out their original mortgage.
Stonebridge noted that, because of reporting delays, some of the cases included in the FCA figures may have been approved before the revised rules formally came into force.
