Neil McLellan, Managing Director, Scottish Widows Bank
Upcoming changes in the mortgage market
We have seen some ups and downs in financial markets recently. Some of this has been related to Brexit uncertainty, which will clearly have further twists and turns before it concludes.
The Bank of England has signalled that there is likely to be an increase in the base rate in 2018 or early in 2019. This speculation has seen swap rates increase and the majority of lenders are now starting to pass the increased costs onto customers.
Time is of the essence for discussing remortgaging
There is no doubt we are moving into a new, upward trend phase for interest rates as lenders can no longer sustain the increased cost of funds, due to the uncertainties in the market.
But right now there are some very competitive products available. So, if you have a client who is nearing the end of their current deal or has been sitting comfortably on SVR, now is the time to discuss switching with them. They could be able to secure a better deal for the years ahead.
The remortgage movement has already started
When the previous Bank of England base rate changed at the end of 2017, we saw about 15% more remortgage activity in the week of the move than the preceding week. Current mortgage search trends are already showing activity at similar levels.
In 2017, Scottish Widows Bank saw an increase in mortgage applications of 143%, with customers looking towards longer 5-year fixed offset deals, giving them security, but with the flexibility needed with offset. These trends are continuing this year, too.
Remortgaging with Scottish Widows Bank
Now really is a great time to be reviewing your existing clients who could benefit from remortgaging, and providing good quality, valuable advice for these uncertain times.
With that in mind, I’d urge you to take a look at the competitive offset product range that Scottish Widows Bank has to offer.
For further insight and expert guidance, please visit Scottish Widows Change Hub.