Analysis of two-year and three-year fixed rate mortgage data by Legal & General shows that on average, rates have fallen 0.2% since January this year. This has largely been fuelled by the Bank of England’s decision to lower the base rate to 0.25% in August, which was preceded by lenders pricing in the cut by reducing SVRs and fixed rate mortgages to record low levels.
However despite some reductions in SVRs, Legal & General says around half of lenders have failed to pass on the change to their variable rate products. As a result it has launched a campaign that is calling on advisers to encourage clients to remortgage now.
“Borrowers on an SVR or coming to the end of their existing mortgage have the potential to save thousands of pounds, the equivalent of a monthly pay rise or a family holiday at half term,” said Jeremy Duncombe, a director at the Legal & General Mortgage Club.
To help encourage borrowers to consider remortgaging, Legal & General will support intermediaries with new literature, including leaflets and email templates to contact existing clients.
“In spite of the great deals available, the unpredictable and complicated nature of the mortgage market can make the idea of switching mortgage a daunting task for many borrowers,” said Duncombe.
“At Legal & General we think now is great time for advisers to show their worth, which is why we’ve created a suite of marketing material to support our brokers. Brokers should look to contact their books and build long-lasting relationships with borrowers by helping them navigate through the thousands of products in the market and secure a new deal on their mortgage.”