A surge in remortgage applications is being seen by national conveyancing specialist LMS.
The firm says that while gross remortgage lending went up 13% in July compared with the month before, at £3.5bn it is low by historic standards and down on the same time last year.
LMS says that borrowers have been holding back on remortgaging, awaiting more attractive deals.
Andy Knee, LMS chief executive, said: “July’s remortgage lending is still low in the context of the history of mortgage lending. The July value followed a sharp fall in June, itself the lowest remortgage lending figures since December 2010.
“The low monthly figures reflect the fact that many borrowers, already on competitive existing rates, have had little incentive to remortgage.
“Indeed, most new deals which borrowers could have taken out and completed in June or July would not reduce monthly repayments sufficiently to encourage people to remortgage, so borrowers have held off taking any action.
“However, the good news is that better deals have materialised. Lenders have recently launched a number of sub-3% rates with terms of four or five years.
“This has led to a real surge in remortgage applications in late July that has continued into August. We had been expecting this to be a disappointing time with the distraction of the Olympics but the reverse has happened.
“These applications should become completions in late August and September and suggest that we will see a sharp rise in remortgage lending later in the year.”
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