Remortgaging may not be on the minds of many homeowners right now according to the reports of demand levels and it is surprising considering the lending deals.  Almost overnight lending in the remortgage market seemed to go from rising interest rates and low loan to value fixed rate deals to a competitive market where lenders are fighting for the attention of borrowers.  A little over a month ago borrowers had rising standard variable rates (SVR) on one side for those that choose to let their mortgage deal end without a remortgage and on the other side the offerings from lenders were uninspiring with rising interest rates, few incentives, and the need for 20-40% equity levels or deposits.  Data showed that homeowners were choosing to take their chances on their lender’s risky and rising SVRs than seek out a remortgage. 

The Government stepped in and revealed an escape for lenders from the tight and expensive global lending market.  The Government’s Funding for Lending scheme offered low cost funding for lenders to keep loans flowing to those that needed them and at cheaper interest rates.  It took very little time for the impact of the scheme to be seen as lenders began to offer historically low interest rates on fixed rate mortgage deals.  Some deals fell below the 3% interest rate level for those that could meet 40% loan to value levels.

The lowest interest rate deals couldn’t be captured by many hopeful borrowers due to the LTV levels and when the demand remained weak for the offers the lenders made the deals better.  LTV levels increased and just recently there were 90% deals that hit the market.  Deals have also begun to include more free incentives and fees lowered while some were fee free. 

Those considering a remortgage that failed to be inspired with deals a few months ago will find they have better choices now.