16% of homeowners are considering remortgaging over the next six months, according to new research from the Nottingham Building Society.
The mutual found that homeowners are looking for average savings of £99 a month – equivalent to £1,188 a year .
This comes as Council of Mortgage Lenders figures show lending for remortgaging increased 15% month-on-month in the most recent data and industry pundits are forecasting a surge in remortgaging in response to recent rate cuts which have seen five-year fixed rates drop below 2%.
The Nottingham’s research shows five-year fixes are the most popular choice for customers considering remortgaging – 27% of potential remortgaging customers would choose a five-year fix ahead of 21% opting for a two-year fix.
The research shows strong demand for fixed-rate deals – around three-quarters of those considering remortgaging would choose a fixed-rate deal. The study found 12% would ideally fix for longer than five years.
Just 7% of those surveyed would choose tracker rates while 4% would consider discount deals and 7% say they would choose a standard variable rate.
Ian Gibbons, Nottingham Mortgage Services ‘(part of The Nottingham) senior mortgage broking manager, said: “The mortgage price war is interesting to existing homeowners who are keen to take advantage of the record low rates.
“With interest rates expected to rise in the coming years then now could well be the right time for many to consider whether there are savings to be had.
“Potentially savings are higher than the average £99 a month people are looking for. Someone with a £150,000 mortgage who moved from a deal at 4% to one at 2% could be around £3,000 a year better off.
“However, to secure the best remortgage deal it is important to look at more than the base rate. You need to search the whole market and to be aware of the product fees that may be charged. A great rate won’t save you much if you have to pay a high fee.”