Remortgaging rates rocket

Borrowers rushing to grab the best deals have led to an increase in remortgaging, which has soared in the last year according to new figures.

A survey has revealed over a third of consumers chose to remortgage in February – an increase of 43 per cent since March 2007.

SpicerHaart Financial Services, an independent network of estate agents, carried out the research which also revealed a huge take-up recently of longer-term fixed-rate mortgages.

Its research showed products with fixed rates which last for more than four years now make up almost a quarter of all mortgage deals being secured.

And the number of borrowers opting for longer-term fixed deals, lasting between seven and 25 years, has reached the highest levels ever.

SpicerHaart thinks the rise in remortgaging is down to borrowers hurrying to secure the best deals before turbulent credit conditions in the market worsen.

Steve Cox, operations director of the firm, said: "Following the credit crunch we have seen a steady increase in the number of people choosing to remortgage their property, using the cash to improve their existing property or pay off debts.

"It is also attributable to consumers who are coming to the end of fixed-rate mortgages, as they look to secure competitive deals."

The sudden popularity of long-term fixed-rate mortgages is a sign, meanwhile, that homeowners are looking for more security when it comes to making monthly repayments said Mr Cox.

"Though the base rate held this month, interest rates are still relatively low and consumers believe that choosing a long-term fixed mortgage now will pay dividends in the future.

"By choosing these products borrowers are ensuring their mortgages are set at the current lower rates for the long term."