Is it time to remortgage? Here’s why so many are jumping on the bandwagon

What was the most common type of mortgage arranged in the last three months? Buy to lets? First-time buyer deals? Or loans for people moving home? Well, the answer is ‘none of the above’. National and London mortgage brokers report that remortgages were the most popular types of application between July and September 2012, with over a third of new mortgages being for refinancing. Have you taken advantage of the superb large mortgage deals on offer yet?

Over a third of loans in July to September were remortgages

According to the latest Paragon Mortgages FACT survey, remortgage applications were the most popular cases handled by intermediaries in the third quarter of 2012.
Brokers report that 37 per cent of cases handled in the three months to September were remortgages, followed by next-time buyers at 25 per cent and buy-to-let at 19 per cent. First-time buyers accounted for just 17 per cent of mortgage applications.

Mortgage Strategy reports that ‘in terms of interest rates, fixed accounted for 60 per cent of all cases, the highest concentration over the quarter, followed by trackers at 37 per cent and SVRs at 4 per cent.’

Islay Robinson, CEO of London mortgage broker Enness Private Clients who specialise in high net worth mortgage and remortgage finance, said: “With the housing market remaining flat it’s perhaps no surprise to see that remortgages were the most popular type of high-value mortgage application in the last quarter.

“We’ve also seen some extremely competitive pricing over the last few months, particularly for high net worth clients with lots of equity. With the opportunity to fix payments at under 3 per cent for the medium term, many high net worth finance clients have elected to take advantage of some of the lowest large mortgage rates we’ve ever seen.”

Brokers say buy to let lending improving – is it time to remortgage accordingly?

The Paragon Mortgages research also found that over a third of mortgage advisors believe that funding for buy to let mortgages has improved over the last three months.

36 per cent of intermediaries said that they believe financing has improved, while 45 per cent said it has stayed the same and 17 per cent who say it has worsened.
Paragon Mortgages managing director John Heron says: “Intermediaries have reported on an interesting quarter. Whilst business in some areas of the mortgage market such as buy-to-let, have been growing others are relatively stagnant and intermediaries appear cautious about the coming months.

“We are likely to continue to see buy to let cases increasing at a steady level but I suspect that cases handled by intermediaries for first-time buyers will remain limited.”

Mr Robinson from Enness Private Clients who specialise in high-value mortgage finance said: “I expect to see a small growth in the mortgage business in the final quarter of 2012 as the Government’s Funding for Lending scheme begins to have an effect.

“There are signs that mortgage rates are falling thanks to this initiative, particularly for low loan to value remortgages. If the scheme starts to result in more competitive deals at higher loan to values we may well start to see the number of large mortgages for house purchase pick up as we approach 2013.”