According to LMS’ monthly remortgage snapshot for September, the overall cancellation rate fell by 21 per cent to 5.61 per cent while pipeline cases grew by 10 per cent month-on-month.
Around 68 per cent opted for a five-year fixed rate, whilst 22 per cent selected a two-year fix and four per cent chose a 10-year fix. Only one per cent selected a tracker.
Over half, 59 per cent, said the motivation for a fixed rate was security over monthly repayments, and 31 per cent said they were worried about the economy and wanted to lock in a deal now.
Only nine per cent said they chose a fixed rate due to broker recommendation.
The primary goal of remortgaging was to release equity in a property, and 24 per cent said they wanted to lock in a deal and gain long-term security. Around 21 per cent said they wanted lower monthly repayments.
Around half increased their total loan size, with the average loan size increase post remortgage coming to £21,993. For those that reduced total loan size the average loan size decrease came to £13,718.
Over half, 59 per cent, upped their monthly remortgage repayments, with the average monthly repayment increase coming to £236 and the average monthly repayment decrease was £251.
‘Completion to pick up in October’
Nick Chadbourne (pictured), chief executive of LMS, said: “There is no doubt that this is a stressful time for borrowers as they experience an upwards pressure on their mortgage payments, but the end of September is traditionally a big time for ERC expiries.
“This typically means a drop in completions and a swell in pipelines as firms get ready to process these cases on the 1 October. The market volatility caused by the mini Budget also saw instructions drop as lenders immediately withdrew products, so all in all, the statistics show what we would expect.”
He continued: “With the ERC expiry date and the fact that those lucky enough to secure a rate before the budget will see their cases flow through to completion, we expect completions to pick up in October, but it will also likely be a month of anomalies as the ongoing economic instability and changing policy will cause lenders to enter and leave the market with various products as appropriate.”
