It's a great time to be a homeowner! Not only can you benefit from rising house prices to boost the value of equity you have in your home, but thanks to record low rates, it's never been cheaper to have a mortgage. And remortgagors in particular are taking advantage…
New figures from LMS show that 63% of remortgagors opted to reduce their rate in July, up from the 56% who did the same in May, with the rapid reduction in rates since the referendum vote proving incredibly lucrative to homeowners.
As a result, a greater proportion of borrowers have been able to reduce their monthly repayments – 43% were able to do so in July, up from 35% in May – and they've been able to save an impressive amount, too. Indeed, 35% of respondents were able to save £200 or more per month, up from 28% in May – equating to savings of at least £2,400 a year!
Many are confident about the path of mortgage rates in the future, too, as among those who expect rates to change, 59% predict that they'll continue to fall – the first time on record that there have been higher expectations of rates falling than rising. This is also a sharp rise from the 18% who said the same in May and 29% in June, showing little sign of a drop in confidence following the vote.
If anything, confidence is escalating – and many are taking the opportunity to increase the size of their loan as a result. The figures went on to reveal that the percentage of remortgagers who did so rose from 26% in May to 28% in July, with 19% of those increasing their loan by more than £10,000. Encouragingly, it seems that all that extra cash is being put to good use, with the percentage of those remortgaging to pay for home improvements standing at 21%, while 9% opted to pay off debts.
All in all, it's looking good, as Andy Knee of LMS comments: "The aftermath of the vote to leave the European Union has seen many mortgage rates tumble to record lows, a fact that has not been lost by homeowners as many seek to take advantage of low rates. The Bank of England's reduction of the 0.5% base rate to 0.25% is likely to offer an extra incentive to anyone considering remortgaging, [and] there are significant savings to be had in terms of monthly repayments.
"Despite uncertainty, the property market very much remains open for business. The shabby savings rates on offer mean that, when it comes to raising money for home improvements or clearing other debts, many people will naturally consider the wealth they have gained as a result of sustained house price rises."
So why not get in on the action? It's a great time to consider your options, so compare the top remortgage rates and see if you can take advantage.
Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.
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