Those Looking To Remortgage Shouldn’t Stick Their Heads In The Sand
There have been a lot of changes in the mortgage or home loan market over the course of the past twelve months, with a large percentage of the number of deals available being withdrawn by lenders altogether and the vast majority of those deals which remain becoming subject to much stricter lending criteria covering things such as lower income multiples, reduced loan to value ratio products and far more stringent credit scoring procedures.
Despite all these facts, there are still a large number of competitive mortgage loan products currently available on the market place. However, it seems that many home owners are reluctant to even try and remortgage their home, once their current deal has ended, either due to fear of rejection by the lender, or the misguided belief that there are no products available for them to use.
In a recent survey by Cheltenham and Gloucester, in which the lender interviewed 500 home owners whose current mortgage deal was due to end at some point over the next twelve months, it was found that there was a great deal of negativity and lack of confidence amongst consumers with regard to being able to get a better deal than their existing home loan.
37 per cent of those interviewed said that they did not want to even apply to a new mortgage provider, due to the fear of being turned down for a loan. Out of this group, almost half believed that they would have to continue on their current lender’s standard variable rate and almost a third said that even though they were aware they were paying a higher rate than necessary, they would not look for a new loan due to fear of being rejected. Of those individuals who were prepared to remortgage, 38 per cent claimed that they would only spend less than half a day looking for a new mortgage loan.
A spokesman for the Cheltenham and Gloucester said “In a climate of low confidence, home owners are less willing to shop around for a new mortgage. There is no denying there are fewer deals available, but the perception is worse than it is. Industry figures show that there are around 5,000 different mortgages available and the average remortgager owns over half of the equity in their property. So for the majority of people, there is still plenty of choice.”
