With the FCA recently easing some remortgage affordability rules, moving to a new deal is suddenly simpler for certain clients. As long as certain criteria are met, lenders can apply a Modified Affordability Assessment (MAA), essentially a lighter version of affordability checks. This gives some borrowers greater flexibility to shop around and avoid being tied to the same lender if their circumstances change.
Although this may be welcome news for many mortgage customers, it remains for lenders to decide whether to apply the MMA, and standard checks will continue
to apply where a borrower’s circumstances fall outside the permitted criteria or have changed beyond the expected range.
So, with remortgaging potentially becoming easier for eligible clients, what does this mean for lenders and brokers? Could retention be trickier than ever?
In our H2 2025 Mortgage Lender Benchmark, we asked brokers about the trends they’re seeing this year when it comes to clients remortgaging to a new lender versus simply switching their deal.
Product transfers still lead for now
The responses throw up some interesting results. Just under a third of brokers said they’re seeing about the same number of product transfers and external remortgages. A further 25% reported slightly more product transfers, while 17% saw slightly more external deals. Only 16% said they mostly stick to product transfers, and about 11% are mainly seeing external remortgages.
The takeaway? Product transfers remain slightly more popular, with the simplicity of staying with the same lender still popular for certain clients. But there appears to be a growing appetite for external remortgages. Brokers are weighing the practical benefits of product transfers against the potential advantages of finding clients a better deal elsewhere. And if the FCA continues to ease affordability rules, that balance could shift further.
Why brokers still favour product transfers
So, why are product transfers still favoured over remortgages? Because they’re fast, predictable, and hassle-free. Over 52% of brokers said retention and pricing were the main reasons they recommend a product transfer versus a remortgage. Speed and service come next, with over 47% highlighting these factors. This is no surprise, given that product transfers usually involve less paperwork and no revaluation. Despite the FCA’s eased rules, nearly a third of brokers said affordability barriers still make transferring products more favourable than remortgaging. Meanwhile, around a quarter mentioned criteria fit and client preference.
Simpler rules could change the goalposts
The FCA’s review suggests further changes may be coming to responsible lending rules, potentially opening the door to even greater flexibility in affordability checks. If that happens, 56% of brokers predict a small shift towards external remortgages, while 16% foresee a large shift. Meanwhile, 27% expect no change.
For any serious shift, it seems the FCA may indeed need to ease things further. Even with the current policy changes, half of brokers told us that meeting full affordability requirements remains the biggest blocker to remortgaging, suggesting the policy only helps a small proportion of clients. Aside from affordability, packaging and document burdens were flagged by just over 42% of brokers. Valuation delays, lender service-level agreements and client reluctance were also mentioned.
These challenges help explain why product transfers continue to lead the way. As creatures of habit, brokers will stick with what works unless external switching becomes genuinely easier.
Final thoughts
Looking ahead, retention via product transfers could be under real threat, especially if further affordability policy changes come in. If remortgaging becomes even slightly easier, more brokers will feel confident exploring external options, and lenders won’t be able to rely on simplicity alone to keep clients from moving.
In the end, whether the rules change or not, lenders need to ensure their rates and propositions remain competitive. Understanding brokers’ needs and helping them meet their clients’ expectations will remain crucial for staying ahead of the competition.
Jake Sandford is head of data and analytics Smart Money People
