According to the findings, more than a fifth of homeowners who chose to increase their loan, did so by more than £20,000.
Remortgage activity has surged in recent months as consumers face the prospect of rate rises that are expected to take place in a matter of months. Data published today by the Bank of England showed that remortgage approvals in August hit their highest level since October 2008, to total 40,931.
LMS’s research showed that the number of remortgagors who expected rates to rise imminently increased from 16% in February to 28% in August.
Almost two in three homeowners who remortgaged in August did so to take advantage of lower mortgage rates, while 37% did so to reduce their monthly payments by up to £500.
Just 3% of remortgagors were incentivised to stay with their current lender, in contrast to 76% who opted to switch.
Andy Knee, chief executive of LMS (pictured), said: “Competitive offers and the threat of a base rate rise continues to drive remortgaging activity as winter approaches, even though an increase before the end of the year now appears unlikely.
“That said, it is better for borrowers to take the necessary measures in good times rather than be caught off guard when rates do rise. Consumers are certainly abreast of base rate speculation as it becomes an increasingly common topic of discussion. It remains worrying that we have a new generation of borrowers who have not experienced anything other than record-low rate mortgages who may be ill-placed to adjust when rates do rise, but hopefully the affordability requirements within the Mortgage Market Review will lessen this impact.”
