Yorkshire BS reports rise in remortgage demand

5th October 2015

Figures from Yorkshire Building Society show that consumers are snapping up record-low mortgages following speculation that a Bank of England interest rate rise is around the corner. The bank claims the number of remortgage applications received over the summer increased by more than 70% year-on-year.

Yorkshire’s data shows an upsurge from June this year, when remortgage applications increased by 18% compared with the same month in 2014. July saw a huge 127% year-on-year jump. Remortgaging was also up 87% in August, with more households choosing to renew their mortgage deals than at the same time last year.

Mortgage rates were at a record low in July according to Moneyfacts, with the average two-year fixed mortgage rate falling 0.16% at the start of July to 2.76% at the beginning of August, the lowest rate on record.

Rachel Springall, finance expert at Moneyfacts, said: “Mortgage rates have been at record lows this year, but since the murmurings of a base rate rise, it is expected that the lowest deals won’t be around forever. This expectation can lead to a surge of customers looking to get a better deal right now so they don’t miss out.

“Borrowers looking to remortgage may be sitting on a standard variable rate, and because of the potential for this to rise in the coming five years or so, they will be looking for security in this uncertain period.”

Brendan Gilligan, product manager for Yorkshire Building Society, said: “Remortgaging has been a key activity this summer. We have seen a huge upsurge in the numbers of borrowers wanting to renew their mortgage. It seems that record low mortgage rates, combined with the looming spectre of a Bank of England base rate rise has created conditions which have encouraged homeowners to think about looking at their existing mortgage and seeing if they can get a better rate.”

*2 year fixed with TSB 1.09% then 3.59% - APRC is 3.3% Max LTV is 60%. Quoted on 27th May 2020.