36% of borrowers increased their loan size in January, LMS’s Monthly Remortgage Snapshot has revealed.
According to the Snapshot, the average monthly repayment increased by £239 for those who remortgaged in January, and 63% of those who remortgaged took out a 5-year fixed rate product.
37% said their main aim when remortgaging was to gain longer term security, the most popular response.
Nick Chadbourne, CEO at LMS, said: “As predicted at the end of last year, there was a spike in instructions for January.
“This is the case every year since December instructions are always seasonably low, but this year’s figures are higher than January 2022, showing that those who were holding out for better rates are starting to return to the market.
“As appears to be an increasing trend, those who remortgaged in January were primarily seeking to attain longer term security with nearly two-thirds opting for 5-year fixed rates, which continues to be the most popular product.”
He added: “With the increased completion rates following the festive period, the pipeline contracted but this was to be expected.
“Moving forwards, increased market activity is likely to continue with mortgage rates falling below 4% for the first time since September.
“This is despite the repeated Bank of England interest rate rises as these have already been priced into the market.
“As such, we expect to see instructions and the pipeline grow over the next few weeks as well as a rise in cancellations since borrowers who secured rates in December may well reapply at these more attractive rates.”
Additionally, the Snapshot found that the average remortgage loan amount in London and the South East was £306,943 while the average for the rest of the UK stood at £156,659, putting remortgage loan amounts 96% higher in London and the South East than the rest of the UK.
The longest previous mortgage length was found in the North East at 74.26 months (6.19 years) and the shortest was in East Anglia at 51.73 months (4.31 years), putting the longest previous mortgage term 44% longer than the shortest.
