Despite historically low interest rates and high remortgaging levels, a surprisingly high percentage of borrowers are still not tempted to change their mortgage, according to Abbey National.
New research from the lender found over half ‘ 57% ‘ of borrowers are not tempted to switch their mortgage despite historically low rates, and 72% of these are still not aware of potential cost savings.
Abbey National also reported that just 10% of borrowers still thought they could only remortgage if they moved house.
Guy Aldwinckle, head of mortgage marketing at Abbey National, said: ‘We are seeing an increasing number of homeowners remortgaging, but there is still a large group who are unaware of the savings to be made from switching their mortgage. The misconceptions about how easy and straightforward the remortgaging process can be are deterring people from looking for a better deal.’
The research is at odds with claims from market analyst, Datamonitor, which claims that borrower ‘churn’ has reached such levels that lenders are now focusing more on borrower retention as they are being damaged by the high level of remortgaging.
The report said: ‘Consumers are showing more interest in their mortgages and in a highly competitive mortgage market are much more likely to switch lender and/or product. Some lenders have sought to foster mortgage switching in the past and they may now be wishing that borrowers would stay put a little longer.’