According to LMS’ remortgage snapshot for June, instructions and the overall cancellation rate were the same compared to May.
There were 16% fewer remortgages completed in June compared to the prior month, while the remortgage pipeline has increased 8% from the previous month.
Around 46% of borrowers increased their total loan size after remortgaging, with the average increase coming to £22,244.
Only 16% of borrowers lowered their total loan size following a remortgage, and the average loan decrease was estimated at £11,648.
Approximately 38% of borrowers saw no change in their total loan size post-remortgage.
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Looking at monthly loan repayments, more than half – 56% – upped their monthly remortgage repayments, with the average monthly repayment increase slated at £277.01.
A third saw their monthly mortgage repayments fall, with £259.23 being the average monthly repayment decrease.
Only 11% saw no change in their monthly mortgage repayments.
Looking at product purchasing, around 45% opted for a five-year fixed rate and 43% chose a two-year fixed rate, with 3% choosing a three-year fixed rate, tracker or other deal.
Nearly a third – 29% – said their primary goal when remortgaging was to release equity on property or borrow more money, while 23% said they wanted to lower monthly payments.
Around 19% said they wanted security over monthly payments or to lock in a good deal.
Almost three-quarters said they chose a fixed rate as they wanted the security of knowing how much they will pay each month, while 13% said a broker had recommended such a deal, and 11% cited concerns around the economic climate.
Nick Chadbourne (pictured), LMS’ CEO, said: “June presented a relatively flat picture for new remortgage instructions, indicating stability in borrower activity. Completions, however, saw a decline, resulting in a build-up of pipeline volumes as we headed into July.
“This slowdown in completions is not unexpected, given the significant spike in product expiries at the start of July, which naturally shifts completion activity into the new month.
“Looking ahead, we expect instruction volumes to remain broadly flat month-on-month through the remainder of the year. That said, instructions are still tracking around 20% higher than the same period last year, highlighting continued underlying strength. As with July, each quarter end is likely to bring a pronounced spike in completions as more fixed rate products reach maturity.”
