A few months back, I shared that new mortgages are overwhelmingly sold on fixed-rate terms. But, new research from the Council of Mortgage Lenders says that most borrowers are finding themselves on SVRs (Standard Variable Rate).
It turns out that around two thirds of borrowers, according to Mortgage Strategy pay their lenders’ standard rates. Typically, this is because they are reverted to the SVR when their fixed-rate terms end.
With rates expected to rise early next year, brokers and commentators predict a lot of refinance activity this year, as borrowers look for the best rates.
London & Country’s associate director of communications David Hollingworth sums it up:
“You would think that all talks at the moment will lead towards a surge in remortgages towards the end of the year. Talk of base rate rising early next year will mean a lot of borrowers will want to lock a good rate before they are no longer available.
“As we get nearer to the point where that rate increase does happen, mortgage rates will start to look a lot more competitive and people will naturally want to take advantage of that.
“Rising house prices in many areas are also leaving homeowners with more equity so that again will lead to them asking if they can get a better deal.”
If you are currently paying your lender’s SVR, or your fixed-rate term is coming to an end, give us a ring. We can discuss your situation, and plan ahead to find the best rates for your property whether it’s your home, an investment, or buy-to-let.