Mortgage Broker Tools (MBT) has warned that tightening mortgage affordability could threaten the growth in remortgaging.
According to the latest MBT Affordability Index, which analyses real cases processed through the MBT research platform, shows the proportion of remortgage enquiries that are considered to be affordable dropped to 78% in January, which is the lowest level since July 2020, and a fall from 85% in November last year.
The latest Index continued to show a wide spread in the affordability available to remortgage customers, with the average maximum loan available being £253,000, the average minimum loan available dropping to £108,216 leaving a difference of nearly £145,000.
Tanya Toumadj (pictured), CEO at Mortgage Broker Tools, said: “There has been a lot of talk of a remortgage boom this year, but our data shows that fewer remortgage enquiries are considered affordable than at any time since July 2020.
“This could be due to lenders tightening their calculators, customers experiencing a change of income or hoping to increase their borrowing, or a combination of all three. What is clear is that full research, using a comprehensive and accurate affordability platform is vital if brokers want to give their clients the best chance of meeting their objectives and making the most of the potential remortgage boom.”