The report also found that there were 41% more remortgages completed in January 2022 than in December 2021
Remortgage instructions decreased by 21% in January compared to the previous month, the latest monthly remortgage report from LMS showed.
“Although remortgage instructions are down month on month, this is just because December saw a barrage of activity due to an ERC date,” Nick Chadbourne, LMS chief executive officer, said. “There is always a slow start to January too, but, year on year, we are around 60% up, and the end of the month had a particularly high run rate.”
However, the report also found that there were 41% more remortgages completed in January 2022 than in December 2021.
Meanwhile, 43% of borrowers increased their loan size in January, and 64% of those who remortgaged took out a five-year fixed rate product, making it the most popular product in January.
As to the main purpose of remortgaging, 29% said it was done to lower monthly payments.
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Chadbourne said that transactional activity in February activity remains high, contrary to prior expectations.
“It looks like people are still looking to move house while rates are low and, if we had the stock of houses available, the market could still be running like last year,” Chadbourne said. “In short, both sides of the industry will be incredibly busy for the foreseeable.”
“The next major ERC date is April 1 so all remortgage eyes will be on that, while the pipelines in transactional teams also remain swollen creating capacity challenges for conveyancers. The second quarter will soften for remortgages after the big April 1 spike, but this will be short lived as the second half of the year has more product expiries than any six-month period in the past 10 years.”
LMS’s UK remortgage lending estimates are forecasts based on its up-to-date internal conveyancing data and remortgage lending figures provided by UK Finance.
