Remortgage applications rose by 110 per cent year-on-year in April, according to online broker Trussle.
Borrowers who remortgage could save an average of £334 per month, according to the broker, which suggested more homeowners were looking to save money in April by switching to a lower rate.
Mortgage enquiries at Trussle however fell by 37 per cent from March to April, after the government announced the coronavirus lockdown and effective closure of the housing market.
Data from Moneyfacts meanwhile found average mortgage rates had fallen to historic lows at the beginning of May.
Adam Wells, director at Lloyd Wells Mortgages, said: “We’ve seen a lot of brokers advertising for remortgages six months in advance of the end date of early repayment charges.
“By approaching clients early, we can build our pipeline and make sure that we are in a healthier position later in the year. It also ensures that the clients are in the best possible position should there be any increase to rates over the coming months.”
Mr Wells added: “We’ve also been approached by a number of clients who have taken the time in lockdown to assess their cashflow and want to extend the term of their mortgages, consolidate debt or secure a long term fixed rate.
“The lower monthly payments were very appealing, despite the fact they will spend more on interest over the term of their mortgage.”
In terms of mortgage applications Trussle found first time buyers to be among the hardest hit, with applications down 35 per cent year-on-year in April, and a 53 per cent decrease in submissions between March and April.
But with most lenders considering the reduced salaries of furloughed workers, Trussle said this had also affected high-earners, as more expensive homes were potentially out of reach until they could return to work.
Miles Robinson, head of mortgages at Trussle, said: “Many lenders are also hesitant to consider overtime and bonuses at this point in time as it is certainly not guaranteed income.”
Mr Wells said: “We have certainly seen a drop in enquiries that we would expect to see at this time of year.
“We’ve combated this by maintaining our relationships with our introducers, making sure they are aware that we are still up and running and how we are able to help their clients and them.
“We have also taken the time to rebuild our website and increase our online advertising in an effort to increase traffic and build awareness.”
Speaking to FTAdviser in April, Kevin Roberts, director at Legal & General Mortgage Club, described remortgaging as the “lifeblood” of the mortgage advice industry, when the purchase business for advisers had become “a mere trickle” during lockdown.
Meanwhile a survey from mortgage brokers by Smart Money People found the majority (77 per cent) believed mortgage lending would recover to pre-pandemic levels within nine months of last week's market reopening.
chloe.cheung@ft.com
