There's a lot going on in the mortgage market at the moment. Speculation about an impending change to base rate – and the inevitable impact it'll have on mortgage rates – is only increasing, and it's leading a lot of people to reconsider their current situation.
This could account for the growing interest in remortgaging, with research from Mortgage Advice Bureau (MAB) finding that consumer appetite for remortgaging is at a four-year high. Their latest Mortgage Search Tracker revealed that 55% of online mortgage searches in the second quarter of the year were related to remortgaging – meaning that over half of those who were looking for mortgages over the quarter were current homeowners seeking to improve their deal. This is a noticeable increase from the 35% recorded in the first quarter and far more than the 26% seen at the end of last year, and also marks the highest figure since recording began in 2010.
It means that just 45% of searches were conducted by prospective buyers, a noticeable drop from the 74% recorded in the equivalent period last year. So just what's the reason for this renewed appetite to remortgage, and the resulting drop in prospective buyers? Well, analysis would suggest that ongoing base rate speculation has prompted consumers to improve their existing deals before mortgage rates rise significantly, while rising house prices and tightened application criteria following the Mortgage Market Review (MMR) have combined to reduce interest in new house purchase loans.
Brian Murphy, head of lending at MAB, commented on the latest findings: "Remortgage lending may have been subdued in recent months [additional figures show that the number of remortgage loans advanced fell by 18% over the month], but these figures suggest there is a sizable swell of enthusiasm building up that is likely to break through as the year progresses and the inevitable rate rise approaches."
In essence, it means people want to switch – and ideally fix – to a new mortgage deal before rates rise too much, thereby keeping their repayments low for as long as possible. A lot of homeowners would have been enjoying record low repayments over the last few years so it's understandable they want to keep that going, and if you're coming to the end of your mortgage term it could be a great time to get on the remortgaging bandwagon.
Rates are already starting to rise, so finding the best deals now would be well advised. As Brian Murphy added, low repayments "won't change overnight with incremental base rate increases on the cards – but the prospect of a rate change makes it worth revisiting the decision to stick or twist with your existing mortgage." So why not follow in the footsteps of other consumers? Do your research to find the deals that are right for you – before you miss out.
Check out the top remortgage deals
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