LMS, the conveyancer and panel management specialist, has released its monthly remortgage snapshot indicating an increase in remortgaging activity for the second half of the year.
According to the report, remortgage instructions increased by 11% in May. However, remortgage completions saw a slight drop of 1%.
The overall cancellation rate also witnessed a slight decrease of 0.22%, while pipeline cases fell by 2% month on month.
Interestingly, 43% of borrowers opted to increase their loan size in May. The data revealed that 50% of those who remortgaged in May chose a 5-year fixed-rate product, which turned out to be the most popular product for the month. Around 29% of remortgagers stated that their primary objective was to lower their monthly payments.
Nick Chadbourne, CEO at LMS, said: “As predicted, instructions increased again in May following a seasonal dip the month before. With the base rate increasing to 4.5% early on, it’s not a surprise that people looking to remortgage when their product expires are aiming to come off Standard Variable Rates for more stability.”
Chadbourne anticipates a busy second half of the year, predicting a significant rise in instructions and an expanding pipeline.
He added: “It will be the busiest in terms of product expiries since the 2008 credit crunch, with well over half a million people expected to remortgage.
“Those remortgaging may opt for a 2-year fix in anticipation of lower rates next time. If market predictions are accurate, this strategy would be wise as rates are likely to drop during 2024.”
