A report by the Council of Mortgage Lenders (CML) has revealed that the number of homeowners taking out re-mortgage deals increased by a third in June 2015. Talk of a Bank of England base rate rise combined with competitive fixed rate deals, has seen many securing their payments in an effort to pro-actively avoid being affected by any increases.
Nearly 32,000 re-mortgage loans were taken out in June, marking a 3-fold increase from May. According to the CML, June also saw surprisingly low levels of monthly income being used to service mortgage payments, with homeowners paying just 17.9% on repayments, the lowest since 2005. Paul Smee, director general at the CML, said: “It is likely that people are now beginning to feel a rate rise is a realistic prospect and not just a distant theoretical possibility”.
With rates still at an all-time low you may think that your lender’s SVR, or standard variable rate, is the best deal for your mortgage. But some experts have noticed lenders already beginning to increase their rates in preparation for the rise in UK base rate. With the Bank of England Governor Mark Carney saying that the rise was “drawing closer”, now is the ideal time to see if switching to a fixed rate will save you money.