The Financial Conduct challenged lenders to weigh mortgages and “rebalance” how they view risk when they look at savings when unlocking the wealth market for later households.
Emad Aladhal, FCA director at retail banks, said the mortgage market has become a region that is “resilient” but “credible people can struggle to access it.” 
The regulator said: “Affordable prices are growing, consumer numbers are increasing, and many are projected to pay off their mortgages in later years.
“For the next few years, retiring mortgage debts is no longer a niche, and will become more and more standard.
“Is there any safety at the expense of access to trustworthy borrowers? Has the right balance been put in place?”
“And if the market was to adapt its risk appetite — to broaden access — how can we do so without responsibly lending to compromise on comprehensive principles?”
Aladhal noted that lenders responded as the FCA encouraged lenders to show “flexibility” to existing stress tests applied to home buyers in March.
Barclays, Halifax, Natwest, Lloyds Banking Group and Santander are key lenders that have adjusted mortgage rules in recent weeks to allow some customers to borrow an additional £40,000.
Watchdog has promised that its second summer review in June will be a broader paper “on the future of mortgage markets and implementation regulations.”
The FCA says the reviews will cover.
For example, how to create space for innovation through a change in affordable valuation
For example, how are customers supported to access the market and make the right choice through changes to disclosure requirements?
Yesterday, Aladhal asked lenders to consider ways to assess affordability and default risk in a way that can support more customers who have access to lending.
He added: “Can a customer's savings record be formed part of the risk profile when applying for a mortgage, either cash savings, ISA, or pension?”
Regulators also urged lenders to take a new look at the stock release market.
He pointed out: “Housing is a valuable and important store. The country's housing stocks have been embodied at around 9.1TN. For the current cohort of retirees, full ownership is growing at the fastest.
“Do we need to support older homeowners and prepare to access the wealth of our homes?
“The important thing is, if some kind of mortgage is the right option for later life, how can it be made more attractive and offer greater value?”
Aladhal added: “We are already carefully listening and considering where we target efforts to provide a more innovative and accessible market.”
