You are here: Home - News -

Remortgage completions soar as borrowers target fixed-rate loans – IMLA

by:
  • 09/11/2017
  • 0
Remortgage completions soar as borrowers target fixed-rate loans – IMLA
Almost eight in ten (78%) remortgage applications went through to completion during Q3 2017 as remortgage applications soared before the first Bank of England Base Rate rise in a decade.

This was the highest of all the segments tracked in the mortgage market by the Intermediary Mortgage Lenders Association (IMLA) – with lending data showing remortgage activity spiked by 20% in September alone.

IMLA noted that back in Q2 2016, only 59 in every 100 remortgage applications reached completion.

 

Fixed-rate boom

IMLA also noted that demand had shifted significantly to fixed-rate mortgages during the first half of 2017 as homeowners attempted to protect themselves against the likely interest rate rises to come.

Three in four (76%) brokers reported an increase in demand for five-year fixed rates during the first six months of the year, with 23% stating that demand had increased substantially.

Nearly seven in ten (69%) lenders stated demand had increased, with 16% noticing a substantial increase.

Overall, three-quarters (76%) of all mortgage applications resulted in completion with all sectors tracked improving on the previous three months of 2017.

Completions per 100 applications:

  • All – 76% (up from 71% in Q2 2017)
  • First-time buyers – 74% (68%)
  • Homemovers – 74% (70%)
  • Remortgagors – 78% (75%)
  • Buy-to-let – 76% (71%)
  • Other specialist – 76% (70%)

On an annual basis, total mortgage applications that led to offers reached 88% in Q3 2017 (up from 75% in Q3 2016), while total offers that led to completions reached 86% (up from 74% in Q3 2016).

 

Intermediary success continuing

The IMLA quarterly Mortgage Market Tracker – which uses data from BDRC Continental – follows applicants’ journeys through the intermediary channel from initial enquiry through to completion.

IMLA said the rise in remortgage completions came amid an overall positive picture for the mortgage market in terms of consumers’ access to finance.

IMLA executive director Peter Williams believed the industry debate about a possible rate rise was clearly identified by borrowers across the UK. “As a rise became more of a certainty, significant numbers of homeowners have rushed to secure fixed rate mortgages priced to a 0.25% Bank rate for the next two, three, five or even ten years,” he said.

“While customers who remain on tracker and standard variable rates are now adjusting to the first increase in monthly loan repayments in the last ten years, unwavering borrower demand and lender supply should maintain competitive residential loan-to-value (LTV) mortgage pricing in what is now a -rate rise environment.

“Despite uncertainty in the wider economy, our data also shows the intermediary channel continuing its recent success in matching consumers with suitable products, helped by strong competition and appetite to lend within the boundaries of careful affordability rules,” he added.

There are 0 Comment(s)

You may also be interested in

Business Skills

In this section, we offer short ‘how to’ guides on harder to crack areas of business. From social media, to regulation or niche product areas, we cover it all.

Profiles

Our journalists interview key industry entrepreneurs, strategists and commentators for day-to-day market insight and a strategic view of where the industry is heading. We offer lessons for success and explore the opportunities for your business

Success in Practice

Here, we share case studies fleshing out best practice to help you decide what could work for your business. Take a look at how others approached complex tasks like launching a new mortgage lender, advising on a new product area or deciding to specialise in another. Learn from others mistakes and triumphs.

Marketwatch

Each week, we ask top mortgage and property commentators with a unique perspective to examine a key news headline, market move or regulatory or political issue.

Poll

Vote in our weekly poll here. It’s your chance to tell us what you think and be heard on the top news stories of the week. Review our archive to find out what your industry really thinks and all our coverage of the results.

Top Comments

Be part of the conversation on Mortgage Solutions. We want to hear from you. We have a tool called Disqus to tell us which stories get the most comments each week. Every Friday, the team picks the most thoughtful or opinionated contributions from our readers to enjoy again. Don’t forget to share your favourite stories from the site on social media to keep the conversation going.

Read previous post:
for sale signs
Home sales fall in most UK regions but London and SE slump deepening, says RICS

A drop in buyer demand caused the housing market to stutter its way through October, with London, the South East...

Close