The UK remortgage market has seen its toughest days according to one housing market insider.  Ben Thompson, of Legal & General Mortgage Club, is convinced the remortgage sector is seeing the future remortgage customers step on the property ladder now, and that explains the slow activity currently taking place.  Remortgages slid almost 30% during the year 2012.  First time buyers, who will ultimately become remortgagers, are now able to purchase a house in many cases due to several factors which have turned for them.

Thompson commented on the future of the remortgage market, saying: “If the bulk of the money is going towards first-time buyers and home movers then that is actually a really good thing because that will get the housing market moving creating future remortgage customers .”

Original mortgage lending increased during the first month of the year by more than 6%.  This is encouraging and should be a catalyst for more remortgage activity in the near future.

Thompson continued his remarks and explained why remortgaging will increase in the coming months, saying: “Going back some 10 months ago some people would have been sat on a rate which they could not better because new business rates were not noticeably cheaper. But since the Funding for Lending Scheme has come into play the costs of funds has fallen in particular over the last four or five months. Those with the equity have some crazy rates being thrown at them but there are a lot of people who are mortgage prisoners so they can’t switch from lender to another. As these improvements in pricing filter up the LTV curve, interest in remortgaging will rise.”