Written by Kellie Steed, Uswitch mortgage expert
When will remortgaging become more affordable?
“Despite mortgage rates continuing on a downwards trend for the third consecutive month, A report by conveyancing firm, LMS, has shown that remortgage instructions fell by 13% in October, in favour of product transfers. A product transfer is changing mortgages with your existing lender.
“They also reported an increase in remortgage cancellation rates, up to 7.7%, as well as an average increase of £187.72 for those who completed their remortgage in October.
“Although product transfer rates are not universally more appealing than the rates currently being offered, it’s expected that many mortgage holders are concerned by the more rigid finance and credit checks required for a remortgage, compared to a product transfer.
“It’s also possible that people are holding out for better remortgage rates, given the current continued fall in the cost of fixed-rate deals available. However, economists dont’ feel that a significant fall in mortgage interest rates will be seen until the end of 2024.
Should I consider a remortgage now?
“The answer to this question will, of course, always depend on your individual circumstances – so there’s no blanket answer that will apply to all. However, it’s important not to write it off due to headlines and fear of rejection, as there are still savings to be made in some cases.
“If you’re due to remortgage, here are some tips to consider to help you make the best decision for long-term goals:
- Don’t underestimate the importance of equity – If you’ve paid off a good chunk of your mortgage, and particularly if your property has increased in value, you may have gained substantial equity in your home. As well as giving you access to more appealing interest rates, this can balance out some of the perceived risk for some lenders. If your credit rating has taken a hit due to cost of living crisis, it’s possible that a good level of equity will soften this blow. Many lenders are looking at remortgage applications more holistically than ever, so don’t base your decision solely on your credit score before speaking to a mortgage broker
- The Mortgage Charter still applies – Although this was brought in back in June of 2023, the mortgage charter is still in effect. This means that lenders are obliged to be more flexible when considering remortgage applications. If you are unable to remortgage, it does also mean that you’ll be able to access a product transfer without any financial assessment
- Product transfers won’t usually be quicker if you increase your borrowing – If you’re simply looking to coast and pay off your existing home loan, a product transfer can be easier and quicker to get. However, if you want to borrow more, remortgaging elsewhere is likely to be just as straightforward. Borrowing more during a product transfer requires a further advance – which means finance and credit checks are still needed, and it’s unlikely to save you any time versus remortgaging elsewhere. Our broker partner, Mojo mortgages, will be able to advise you further, depending on your specific needs
Average mortgage rates across the big six lenders*:
|
|
Rates (7th November) |
Rates (14th November) |
% change from last week |
|
Two-year fixed-rate mortgage (75% LTV) |
5.59% |
5.53% |
-0.06% |
|
Five-year fixed-rate mortgage rate (75% LTV) |
4.99% |
4.95% |
-0.04% |
|
Two-year variable-rate mortgage rate (75% LTV) |
5.74% |
5.74% |
– |
|
Two-year fixed-rate mortgage (90% LTV) |
6.07% |
5.965% |
+0.105% |
|
Standard variable rate (SVR) |
7.99% |
7.99% |
– |
*Nationwide, Santander, HSBC, Halifax, Barclays Bank, NatWest, and Lloyds Bank.
Average mortgage rates:
|
|
Rates (7th November) |
Rates (14th November) |
% change from last week |
|
Two-year fixed-rate mortgage (75% LTV) |
6.44% |
6.44% |
– |
|
Five-year fixed-rate mortgage rate (75% LTV) |
6.12% |
6.09% |
-0.03% |
|
Two-year variable-rate mortgage rate (75% LTV) |
5.94% |
5.94% |
– |
|
Two-year fixed-rate mortgage (90% LTV) |
6.14% |
6.09% |
-0.05% |
|
Standard variable rate (SVR) |
8.74% |
8.74% |
– |
Buy-to-let mortgage rates:
|
Two-year fixed buy-to-let (75% LTV) |
Rates (7th November) |
Rates (14th November) |
Lenders |
% change from last week |
|
Average across all lenders |
6.19% |
6.14% |
– |
-0.05% |
|
Average across big six lenders |
6.14% |
6.14% |
– |
– |
|
Lowest rates across all lenders |
4.64% |
4.19% |
LendInvest Mortgages |
-0.45% |
|
Lowest rates across big six lenders |
5.64% |
5.64% |
Santander UK PLC |
– |
Visit https://www.uswitch.com/mortgages/ for all the latest deals
For further information on this release, please contact:
Rianna Monteagudo, [email protected]
To note:
The rates listed above aren’t always indicative of the rate prospective buyers would be offered and may not be available when someone comes to apply for a mortgage
The rate someone can get will be determined by their financial situation and the size of their deposit. The larger the deposit, the lower the loan-to-value (LTV), allowing buyers to access better deals because lenders consider them to be less risky.
About Uswitch
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