Over half of remortgagors release equity
The majority (57%) of remortgagagors in 2016 switched their homeloan to raise capital, according to figures from My Home Move.
The conveyancing specialist said that this suggests homeowners want to release equity ‘cheaply’ for home improvements, to consolidate debt or to act as the Bank of Mum and Dad and give money to their children.
Homeowners across England and Wales, on average, remortgaged for around £15,000 more in 2016 than they did two years ago, borrowing around £181,000 compared to £166,000 in 2014.
My Home Move also discovered that those in the East Midlands borrowed almost double the amount in 2016 compared to 2014; while switchers in the East of England, Home Counties, North West, South East and Wales also increased their debt compared to two years ago.
Doug Crawford, CEO of My Home Move, said: ““This overall increase in borrowing suggests that homeowners are taking advantage of the ‘cheap’ remortgage deals which have been around for the past few years, and thanks to the Bank of England base rate cut in August, will remain so for months to come.”
“Our remortgage activity has been steadily increasing over the past few years, and with the threat of a rate increase due to increasing inflation levels, brokers and consumers are alert to “this won’t last forever” sentiment. We have already seen SWAP rates, that govern the price of fixed rate mortgages, increasing over recent weeks and this will drive further activity.”