More People Switching Home Owner Loans
Following the reductions in the Bank of England Base rate of interest for home owner loans and mortgages to just 0.5 per cent nineteen months ago, the vast majority of borrowers with a variable rate on their home owner loan have been fairly contented to remain with their existing lender, rather than shop around for a cheap loan deal.
As a result of this, remortgage activity has fallen to an all time low over the course of the past couple of years or so.
But new figures from the home owner loan broker, John Charcoal, have revealed a significant jump recently, in the number of borrowers looking to switch their loan to a new provider in order to get a better deal.
The loan broker’s figures show that the number of people applying for a remortgage loan jumped by 42 per cent over the course of the last month alone, with 855 separate remortgage enquiries during the month of October, compared with just 600 throughout the previous month.
As more competition starts to return to the home owner loan market and some lenders are increasing their standard variable rate on their existing loan products, a remortgage deal is suddenly looking far more attractive than it was twelve months ago.
Unexpected positive growth in the UK economy and high rates of inflation have raised issues about interest rates on loans increasing sooner rather than later and this has prompted many borrowers to switch their home owner loan to a fixed rate deal, in order to keep costs down in the future.
Drew Wotherspoon of John Charcoal said “It is certainly encouraging that consumers are keeping on top of their options. With some excellent mortgages now available, it could well be precisely the right time for many to move their mortgage.”
