Levels of activity in the UK's remortgage market remained in a rather subdued state during last year, according to a new report by Lloyds Banking Group.
The number of borrowers taking out remortgage products dropped by 12% during 2012 compared with the previous year. Remortgage activity during December last year was 24% less than in 2008, with 28,200 loans advanced compared with 116,600 in January 2008.
The remortgage market has suffered as a consequence of the credit crisis, with figures revealing that between November 2008 and July 2011, the number of loans approved fell to an average of 30,000 per month, down from a monthly average of 86,800 during January and October 2008.
Despite the sector experiencing an overall slump during 2012, activity began to pick up in the latter months, increasing by 7% during quarter three and four last year.
This recent slight revival in activity is thought to be a result of the Funding for Lending Scheme (FLS), introduced by the Government last August to encourage lending from banks and building societies to individuals and small non-financial businesses.
A number of lenders participating in the scheme have reduced mortgage rates and launched highly competitive deals.
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