Remortgage instructions decreased by 14% in June, data from LMS’ Monthly Remortgage Snapshot has revealed.
According to the snapshot, there were 32% fewer remortgages completed in June, while the overall cancellation rate decreased by 9%.
In addition, pipeline cases decreased by 4% month-on-month.
47% of borrowers increased their loan size throughout the month, while June saw a £364.09 average monthly payment increase for those who remortgaged.
45% of those who remortgaged took out a 2-year fixed rate product, the most popular product last month.
26% said their main aim when remortgaging was to lower their monthly payments, making it the most popular response.
On a regional basis, the average remortgage loan amount in London was £360,297, while the average for the rest of the UK stood at £173,842.
The longest previous mortgage length was found in London at 75.91 months (6.33 years), while the shortest was in the West Midlands at 63.23 months (5.27 years), making the longest previous mortgage term 20% longer than the shortest.
Nick Chadbourne, CEO of LMS, said: “As predicted, we have seen a reduction in remortgage activity and it’s a trend we can expect to continue over the coming months.
“Whilst the scaremongers out there would have you believe borrowers are sitting waiting to see rates drop, the reality is that we are in a quiet phase for product expiries, and product transfers continue to win the day whilst lender margins are tight.
“The stability of a new government, an expected rate cut towards the end of the summer, and increasing lender competition will start to reverse this activity trend.
“However, I don’t expect this to happen until the kids are well into the first term of their new school year.”
