Remortgaging hits seven-year high in April

Remortgage lending leapt 48% by value in the year to April to hit £6.4 billion, the largest sum recorded since November 2009.

The number of borrowers remortgaging rose sharply to top 39,300, the highest since July 2009.

Affordability also improved markedly with typical remortgage repayments falling to a record low, according to new research from LMS.

April’s £6.4 billion is up 36% on the £4.7 billion recorded in March.

The number of remortgage loans also increased – by 41% – from 28,000 in March to 39,353 in April.

This is 47% more than April 2015 when 26,700 borrowers remortgaged. 

Low interest rates have boosted affordability, with remortgage payments as a percentage of income falling to a record low of 16.79%, down from 18.4% in March.

Andy Knee, chief executive of LMS, said: “Remortgaging in April has bounced back after a quiet March, with levels of activity taking place that haven’t been seen since the recession.

“March saw the market overwhelmed by second homeowners looking to push through transactions before changes to stamp duty came in, but as April arrived, existing homeowners were able to remortgage and capitalise on the great rates currently available.”

Knee said the average amount people are withdrawing through remortgaging fell to a 13-month low, suggesting household budgets are not as constrained as previously.

Mortgage interest rates fell to 2.49% in March, down from 2.51% in February.