The level of remortgaging activity in the UK a considerable slide over the course of May this year, new data has demonstrated.
According to the Council of Mortgage Lenders (CML), the number of loans approved for house purchase increased by four per cent in May but the volume of remortgage deals agreed fell by 13 per cent.
Some homeowners are struggling to avoid repossession and debt management disaster but lenders are adding to their strain by increasing the levels of interest they charge for fixed-rate mortgage arrangements.
“The growing popularity of fixed-rate mortgages, despite the relatively high rates, suggests that many borrowers are prioritising certainty in their monthly payments,” said director general of the CML Michael Coogan.
Price comparison firm Fool.co.uk suggested recently that high street lenders are offering their customers relatively unfavourable mortgage deals because they know credit is scarce in the current economic climate.
By Giles Stevenson