June sees a surge in average remortgage loan
While overall remortgage lending fell in June to £3.5bn, the average remortgage loan has hit its highest ever level at £149,514.
According to the latest figures from LMS remortgaging now accounts for 23% of the total market.
Those remortgaging are each taking out an average of £22,615 in extra equity the highest amount per individual since January 2012.
Andy Knee, Chief Executive of LMS said: “Remortgage customers were taking out a record amount of equity — the highest amount since January 2012. A fifth (20%) said they did so to fund home improvements, whilst a further 9% used the additional funds to pay off debts.“
"With Mark Carney confirming that interest rates will not be rising for the time being, others who are considering remortgaging would do well to take advantage of the current deals, as there will be an avalanche of remortgage activity once interest rates do eventually increase.”
According to the latest Mortgages for Business Complex Buy to Let Index, much of this equity release was due to landlords refinancing to raise capital for further purchases.
Their data showed a significantly higher proportion of buy to let remortgaging than purchasing.
David Whittaker, managing director of Mortgages for Business, said: “Buy to let mortgages are at their most affordable since the downturn.
"Lenders have gratefully accepted the help on offer from FLS and have passed some of the savings on to investors in the form of lower rates and a wider choice of mortgages.
“This has encouraged a record proportion of refinancing; with landlords taking advantage of cheaper remortgage deals in order to expand their portfolios further down the line."