Remortgage

Following the Brexit referundum, homeowners are under a degree of uncertainty, and you may well have seen an increase in remortgage enquiries as a result of this.

For those customers on a standard variable rate, or who are coming to the end of their mortgage term, now may be a good time for them to review their current mortgage deal.  After all it could save them money, effectively providing an increase in their monthly income.

The mortgage market is both unpredictable and complicated and often people are looking for help and advice.  With thousands of deals on offer, borrowers need to make sure they are getting the best deal for their circumstances.

Interest rates are at another record low, so it’s a really good time for you to be proactive and talk to your customers about remortgaging.  After all who wouldn’t want to save money on their mortgage?

To support you we have developed some new material to help you to be proactive and build stronger relationships with your customers.

This includes an email template and new customer leaflet to help you generate appointments. We hope this will help make your life easier. 

The great rush to remortgage

This article featured in The Times discusses why homeowners are rushing to remortgage.


The below case studies are based on the Market SVR average at 4.32% - source CML. Max arrangement fees £1,000. Data sourced January 2018.

Based on customer with 60% LTV with £150k loan

150k
   Market SVR 2 Yr Fixed  5 Yr Fixed  2 Yr Tracker 
 Interest Rate  4.32% 1.29%  1.74%  1.24% 
 Lender   Platform Metro Bank

Platform

 Monthly amount £818.50  £585.22  £616.97  £581.75
Potential Monthly Savings    £233.28 £201.53

£236.75

Based on customer with 60% LTV with 250k loan

Market SVR 2 Yr Fixed 5 Yr Fixed 2 Yr Tracker
Interest rate 4.32% 1.29% 1.74% 1.24%
Lender Nationwide Metro Bank Platform
Monthly amount £1364.27 £975.44 £1028.36 £969.67
Potential monthly savings £388.83 £335.91 £394.60

Based on customer with 60% LTV with 500k loan

Market SVR 2 Yr fixed 5 Yr fixed 2 Yr Tracker
Interest rate 4.32% 1.29% 1.74% 1.24%
Lender Santander Metro Bank Platform
Monthly amount £2728.38  £1950.76 £2056.60  £1939.22
 £777.62 £671.78  £789.16

Based on customer with 75% LTV with £150k loan

Market SVR 2 Yr Fixed 5 yr Fixed 2 Y
Interest rate 4.32% 1.34% 1.87% 1.34%
Lender Nationwide Accord Nationwide
Monthly amount £818.50 £588.69 £626.33 £588.69
Potential monthly savings £229.81 £192.17 £229.81

Based on customer with 75% LTV with £250k loan

Market SVR 2 Yr Fixed 5 Yr Fixed 2 Yr Tracker
Interest rate 4.32% 1.34% 1.87% 1.34%
Lender Nationwide Accord Nationwide
Monthly amount £1364.27 £981.20 £1043.94 £981.20
£383.07 £320.33 £383.07

Based on customer with 75% LTV with 500k loan

Market SVR 2 Yr Fixed 5 Yr Fixed 2 Yr Tracker
Interest rate 4.32% 1.34% 1.87% 1.34%
Lender Nationwide Accord Nationwide
Monthly amount £2728.38 £1962.41 £2087.87 £1962.41
Potential monthly savings £765.97 £640.51 £765.97

The number of remortgage products available to your customer has increased and there are over 2000 products available with lenders offering incentives such as free legals to make it easy for borrowers to switch to a new deal. See more about lenders and their criteria in Lenders. 

See more about lenders and their criteria

Thoughts from Jeremy Duncombe, Director, Legal & General Mortgage Club:
“With record low fixed rates dominating the market and thousands of great mortgage deals out there, now is the perfect time for your clients to consider remortgaging. Borrowers on an SVR or coming to the end of their existing mortgage term have the potential to save thousands of pounds on their mortgage, the equivalent of a monthly pay rise or a family holiday at half term. 
 
“However, in spite of the great deals available, the unpredictable and complicated nature of the mortgage market can make the idea of switching mortgage a daunting task for many borrowers. 

"At Legal & General, we think now is a great time for advisers to show their worth, which is why we’ve created a suite of marketing material to support our brokers. Brokers should look to contact their books and build long-lasting relationships with borrowers by helping them to navigate through the thousands of products in the market and secure a new deal on their mortgage.” 

See our lender directory, where you can find out what makes our lenders differ, how to do business with them and what products they offer.
The majority of our panel lenders offer remortgage products and we have been successful in negotiating great exclusives, some only available to our members

Things to consider

With the potential increase in remortgage activity you will need to consider whether switching a customer from the lender SVR is the best thing for them, some questions to ask:

  • Has the amount they’ve borrowed changed?
  • Has their credit history changed since taking out their current mortgage?
  • Have their circumstances, ie job, marital status or family situation changed in any way?
  • Does their current protection plans cover their needs?