Instructions for remortgages across the UK climbed by 27% in July, according to new data published by LMS.

The latest LMS Monthly Remortgage Snapshot revealed there was a rise of 31% on the number of remortgages completed during the month when compared to June.

Figures also showed that the overall cancellation rate across the remortgage market saw a 0.53% rise to reach 6%, while the number of cases in the pipeline climbed by 14%.

The remortgage lending estimates from LMS are forecasts based on its internal conveyancing data as well as remortgage lending figures provided by UK Finance.

LMS CEO, Nick Chadbourne, highlighted that the increase in instructions was expected given a large volume of ERCs expiring in July.

He said: “It’s encouraging that nearly a third more borrowers shopped around for a cheaper deal when the time came to remortgage, benefitting from the rate wars gripping the market as lenders fight to offer the most attractive deal.

“However, despite the healthy volumes, we would still expect activity to be higher, given that July is one of the biggest peaks in ERC expiries in the year. The data shows that many borrowers are in fact continuing to opt for a product transfer due to the competitive rates offered by their current lender.”

According to the data, July saw an average monthly payment decrease of £124 for those who remortgaged during the month, with 45% of those taking out a five-year fixed rate product, the most popular type of product in July.

"Many offers will come with significant arrangement fees, which might not make these deals as appealing in the long-term,” Chadbourne added. “Product transfers aren’t necessarily the best route either, even if a lower rate is on the table, as lenders often reach out months in advance and a better deal could be found if borrowers reviewed all available options closer to the time.

“Advisers must therefore be proactive in reaching out to clients to make them aware of all the options available and provide the best support during this time.”

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