Remortgages Hit A Five Year Low
According to data released by the Council of Mortgage Lenders in the UK, the figure for remortgages has hit a five year low this year, with dramatic reductions in the number of people taking out this type of secured loan. The data released by the CML indicated that in September 2006 remortgage figures fell to thirty percent compared to forty two percent in September 2005. This is the lowest that they have been for five years, since 2001.
Experts state that there is a reason for the sharp decline in remortgaging, and this is partly down to the stiff competition between mortgage providers. Many mortgage companies are now offering tempting incentives and deals to their existing customers in a bid to keep them as customers and not lose them to another mortgage provider through a better remortgage deal. The Director General of the Council of Mortgage Lenders, Michael Coogan, stated: "The downward trends in remortgaging illustrate how lenders are reacting to competitive conditions, and offering attractive retention products and policies to their customers."
Other figures that were released following research carried out by the Council of Mortgage Lenders indicated that there was also a decline in the number of foxed rate mortgages that were being taken out, with the average interest rate on a fixed rate mortgage having increased since August of this year. Data also suggested that loans to first time buyers this September fell by just over three and a half thousand compared to September of 2005, and loans to home movers fell by around six hundred in the same period.
Michael Coogan went on to state: "Today's figures show that slowly but surely the market is cooling as we approach the end of the year in an environment of higher interest rates."
18th November 2006
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