Up to one in six UK home owners are considering remortgaging over the next six months as the ongoing mortgage price wars cut rates, new research has found.
They are targeting average savings of £99 a month, equivalent to £1,188 a year, according to the study by The Nottingham Building Society Nottingham.
This comes as Council of Mortgage Lenders figures show that lending for remortgaging increased 15% month on month in recent data and industry experts are forecasting a surge in remortgaging in response to recent rate cuts which have seen five year fixed rates drop below 2%.
The Nottingham’s research shows five year fixes are the most popular choice for customers considering remortgaging and 27% of potential remortgaging customers would choose a five year fix and 21% a two year fix.
The research shows strong demand for fixed rate deals as around three quarters of those considering remortgaging would choose a fixed rate deal. The study found 12% would ideally fix for longer than five years.
Just 7% of those surveyed would choose tracker rates while 4% would consider discount deals and 7% say they would choose a standard variable rate.
‘The mortgage price war is interesting to existing home owners who are keen to take advantage of the record low rates. With interest rates expected to rise in the coming years then now could well be the right time for many to consider whether there are savings to be had,’ said Ian Gibbons, senior mortgage broking manager for Nottingham Mortgage Services.
‘Potentially savings are higher than the average £99 a month people are looking for. Someone with a £150,000 mortgage who moved from a deal at 4% to one at 2% could be around £3,000 a year better off,’ he explained.
‘However, to secure the best remortgage deal it is important to look at more than the base rate. You need to search the whole market and to be aware of the product fees that may be charged. A great rate won’t save you much if you have to pay a high fee,’ he added.
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Source: Property News Spain