31% more remortgage completed in July compared to June, with instructions increasing by 27%, according to the latest figures from LMS.
Pipeline cases increased by 14%, while the overall cancellation rate increased by 0.53% to 6%.
Remortgagors reduced their monthly payments by an average of £124 in July and 49% of borrowers increased their loan size.
32% of remortgager’s primary aim when remotgaging was to release equity from their property.
Nick Chadbourne, CEO of LMS, commented: “Though this increase in instructions was expected given the large volume of ERCs expiring in July, it’s encouraging that nearly a third more borrowers shopped around for a cheaper deal when the time came to remortgage, benefitting from the rate wars gripping the market as lenders fight to offer the most attractive deal.
“However, despite the healthy volumes, we would still expect activity to be higher, given that July is one of the biggest peaks in ERC expiries in the year. The data shows that many borrowers are in fact continuing to opt for a product transfer due to the competitive rates offered by their current lender.
“Many offers will come with significant arrangement fees, which might not make these deals as appealing in the long-term. Product transfers aren’t necessarily the best route either, even if a lower rate is on the table, as lenders often reach out months in advance and a better deal could be found if borrowers reviewed all available options closer to the time. Advisors must therefore be proactive in reaching out to clients to make them aware of all the options available and provide the best support during this time.”
Original Article from Financial Reporter 25/08/21