Low rates push remortgaging to highest level for years

Low rates push remortgaging to highest level for years

Remortgaging continued to soar towards the end of last year as homeowners took advantage of low interest rates.

The Bank of England said that in November there were 45,683 approvals for remortgages, their highest level in eight years.

Remortgaging has been increasing since August when the Bank of England lowered interest rates to 0.25 per cent.

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Approvals for house purchase have also been increasing and in November there were 67,505.

Jeremy Duncombe, director of Legal & General Mortgage Club, said: “In the current climate of low interest rates, more and more consumers are prudently taking advantage of the good deals available in the market, saving themselves potentially thousands of pounds a year by remortgaging.

“There is no telling when rates could rise, and it could even be this year.

“By contacting a broker, these individuals will put themselves in the best position to secure a good deal on a new mortgage and save themselves a significant sum of money, something that many will value particularly as we end the festive period.”

Over the past six months there have been an average of 42,664 remortgage approvals a month.

Overall mortgage approvals stood at 126,407 in November, an increase of nearly 13,000 since August.

Mark Dyason, director of Edinburgh Mortgage Advice, said: “There is a growing sense among existing UK homeowners that the first rate rise for a very long time could be on the horizon.

“More recently, this feeling has been compounded by the quarter point rate hike in the US in December. 

“Most people now accept that rates are unlikely to get any better and are taking action to lock in to the competitive rates that are still, for the time being, available.”

He said many people were paying extra for five-year fixes to lock in a lower rate for longer on the basis rates were unlikely to get any better.