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Remortgage Lending Almost Doubled Last Month
This article is an external press release originally published on the Landlord News website, which has now been migrated to the Just Landlords blog.
The amount of remortgage loans hit 46,000 in July, 47% higher than the previous month and the highest number recorded since November 2008.
Conveyancer experts, LMS, calculates that the value of monthly gross remortgage lending rose by 41% to £7.2 billion in July and increased by 89% from July last year. This is the greatest growth seen since
Remortgage Lending Almost Doubled Last Month
October 2008 and is a huge boost to the industry after a slow start to the year.
The total amount of equity withdrawn from remortgaging in July was £1.27 billion, up 16% monthly and 183% annually, when equity was at £449m in July 2014. This is the largest amount withdrawn since April 2008, when £1.35 billion was withdrawn through remortgaging.
Improved affordability of remortgaging and the significant savings that borrowers can make due to record low rates have encouraged higher levels of activity, says LMS.
Chief Executive of LMS, Andy Knee, states: “Remortgaging has come back with a bite in July, following sluggish levels of activity throughout the latter part of 2014 and first months of 2015.
“We are confident these levels will be maintained with a steady stream of customers for the remainder of the year as record low affordability encourages borrowers to lock in competitive rates.
“Despite news that a base rate rise may be on the cards, lenders have not hiked rates and there are still many excellent deals to be had as lenders compete for business. But these will not last forever and borrowers should consider remortgaging now to avoid missing out.
“The current economic climate and rising average incomes mean households are typically less stretched than previously. Remortgaging has never been as affordable and can offer huge monthly savings as the gulf between new purchase and remortgage payments as a percentage of income grew, to 2.7%.
“A six-year high in the amount of equity withdrawn through remortgaging shows financially shrewd borrowers are keen to capitalise on these potential savings.”1
