The number of borrowers who have been able to switch to another lender rather than accept a product transfer has soared as a result of the FCA changes to affordability rules. As a result, they pay less, new research shows.
Last July, the FCA significantly expanded lenders’ ability to use adjusted affordability assessments (MAAs), allowing more borrowers to remortgage on cheaper deals.
Previously, many borrowers were forced to stay with the same lender and transfer a product because they would not pass affordability tests if they tried to transfer their mortgage.
New research from Stonebridge has shown that the rules are having a significant impact.
The number of times custom reviews were used for product transfers in Q1 2026 plummeted from 550 to 100 – an 82% year-over-year decline.
This is despite a 30% annual increase in total MAAs to 5,828 in the first quarter.
The share of borrowers who were able to switch to a new lender with the help of an MAA increased from 88% to 98%.
Those who remortgage from new lenders also borrow more at lower rates, according to the data released to Stonebridge under a freedom of information request.
At 3.92%, interest rates on external MAA remortgages were 0.73 percentage points lower in the first quarter, while the average loan size was 141% higher at £194,999.
That gap widened in the first quarter, with loan sizes for those switching to new lenders rising 5% year-on-year, while product transfer loan sizes fell 37% to £80,749.
The broader market saw a 15% annual increase in total regulated mortgage sales in the first quarter, while refinancing advances made up 29% of sales, up from 21% a year earlier.
Stonebridge chief executive Rob Clifford says: “You can see the hand of advisors at play here.
“They are harnessing the power of MAAs to free customers who felt trapped by helping borrowers get better deals with new lenders.
“The use of product transfers is declining, reflecting better consumer outcomes.
“There is clearly a demand for MAAs, the FCA’s logic in giving lenders more power to make common sense lending decisions is constructive and there is no doubt that they could be used even more widely.
“This is not just about mortgage prisoners or those whose incomes are more irregular.
“For example, many entrepreneurs struggle to meet underwriting criteria after starting a new business, despite paying a mortgage for years, so it’s nice to see the direction of travel in terms of lender acceptance and broker awareness.”