Its research showed that 75% of borrowers chose to apply for fixed rate deals in January 2011, compared to 45% in January 2010.

However, MAB said that levels are still significantly down on March, April and May 2009, when more than 90% of applicants chose fixed rate deals.

Brian Murphy, head of lending at MAB, said: “It’s not surprisingly January saw borrowers migrate to the safety that fixed rate deals offer.

“With a variety of fairly negative economic news, rising inflation and an increase in unemployment levels, borrowers who are active in the market, are erring on the side of caution and increasingly opting to fix their repayments.”

In January, the average LTV on mortgage applications rose to 72%, compared to 70.9% in December 2010.
 
The average loan size on mortgage applications last month was £128,887 up 6.6% from £120,881 in January 2010.

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Meanwhile, the number of mortgage applications in January 2011 increased by 23.3% on December 2010 and 18.4% year-on-year.
 
Murphy said that the rise in mortgage applications was due to adverse weather conditions in December resulting in transactions being carried over into the new year.

On the remortgage front, MAB said that there had been an uplift in activity since the end of 2010 and, despite a predictably quiet December, January 2011 saw remortgage applications back up to pre-December 2010 levels.

Murphy said: “Remortgage activity has definitely picked up and interest rate uncertainty is a key factor driving this uplift, as borrowers on standard variable rates take uncertainty out of the equation.
 
“We are seeing a group of borrowers hedging their bets and remortgaging with the facility to switch to their new lender’s fixed rate range if and when they feel rates are rising too quickly and by too much,” he explained.