The number of remortgage loans increased by 12% from 25,600 in August to 28,686 in September 2015, according to LMS. This is also up 4% from the 27,700 remortgages recorded in September of last year.
LMS also estimates that the value of monthly gross remortgage lending rose by 5% to £4.4bn in September compared to August’s CML figure of £4.2bn and up by 3% from September last year.
The average amount of equity withdrawn from remortgaging per customer fell to £31,241 in September, down from a record high of £35,590 in August. However, this remains 77% higher than in September 2014, when the average amount was just £17,644 a year.
LMS said affordability remains manageable across the country as the average remortgage LTV for eight out of 10 regions fell in September. The North West and North East experienced the greatest fall; both dropping by 7%, to 59% and 60% respectively.
Andy Knee, chief executive of LMS said: “Remortgaging activity keeps plugging away and the autumn rush to remortgage – as well as expectations of a possible base rate rise – will drive more borrowers to the market before the year end. Although there is talk that competitive rates for new mortgages may be in gradual decline, remortgaging still offers a fantastic opportunity to cut costs and remains notably cheaper than a new purchase mortgage.
“It’s positive to see the average remortgage LTV fall in eight out of 10 regions, as borrowers across the country capitalise on competitive rates by remortgaging. In particular, it is an indication of greater economic stability in regions such as the North East and North West who were hit hard by falling house prices in the recession. A rise in the value of their homes has finally enabled those who were mortgage prisoners to release equity or lower their LTV ratios and subsequently enjoy better affordability.
“This is the ideal time for borrowers to re-examine their finances and the untapped benefits of rising house values across the UK. Although we’ve seen a reluctance to seek intermediary advice in September, a broker could provide borrowers support in navigating through the complex mortgage maze we currently have given the availability of record-low interest rates.”