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Remortgage pricing

Journalist: Anna Sagar, Mortgage Solutions / Specialist Lending Solutions

ended 11. July 2023

Interested in speaking to mortgage brokers about remortgage pricing. The top six lenders are pricing new business rates at around 6.2 per cent. 

  • Is this deterring people from opting for a remortgage? 
  • Are product transfers becoming more popular as they are priced lower? 
  • As PTs become more popular will this have an impact on broker income? 

4 responses from the Newspage community

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Stephen Perkins
Managing Director at Yellow Brick Mortgages
Rates are not deterring borrowers from wanting to remortgage, as the lender's standard variable rate (SVR) still remains an unattractive option for most situations. They have however increased the value in receiving advice from a broker to ensure the impact of the rate rises is minimised as much as possible; either by finding the cheapest new deal or reviewing other options such as extending the mortgage term. Product transfer rates are currently highly competitive and their lack of required underwriting and cost-of-living influenced affordability checks will see their popularity increase over the coming months.
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Michelle Lawson
Director at Lawson Financial
We have to be careful that the current mortgage situation is represented accurately in the media to ensure the general public and those affected can make an informed decision. By speaking to a broker, they should get an honest review of their position. Fixed rates are higher however there are a variety of products which should not be overlooked such as discount and tracker rates and these are sitting lower than the fixed rates as they are priced differently. In some situations, it will be better for people to stay with their current lender and change products but not all. I am securing products for customers now in case rates rise but will review and change if rates start to come down. We do get paid lower fees from the lenders for actioning product transfers in most cases so yes, this will have a huge knock on for brokers income ]however, I believe this is under review and is ultimately not the driver as we always have to act for the right outcome for the client.
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Elliott Culley
Director at Switch Mortgage Finance
In my experience, the rates are currently delaying some mortgage holders from making a decision in the hope mortgage rates will reduce before they need to renew. This current strategy has cost some clients money as they could have locked in earlier when rates were more favourable. I completely understand why you would put off securing a new rate, as monthly payments look horrible right now and no one wants to be paying so much more, but mortgage holders need to take control and not leave it up to chance. My advice is to always get a rate secured in case rates rise and you can always switch to a lower rate if it becomes available. Product transfers are not always the cheapest for clients, but again if you have left it late, it can be much quicker to secure a switch with your current mortgage lender. Preparation, reviewing your options and tackling the problem head-on is the best advice I can give on this.
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Scott Aitken
Director | Mortgage & Protection Broker at Aitken Financial Services
Increased interest rates from lenders has seen panic among clients. Many of them are on rates of around 2%, so to remortgage to 6.2% will see a huge increase in their monthly payments and may push them to the point of being unable to afford their mortgage.

This has caused a shift in my business levels and I have seen an increase in product transfers for a variety of reasons. The main one is that clients are leaving things to the last minute as many hoped there would be a change in the rates, unfortunately, this change was an increase. Some lenders are also pricing their product transfers lower than many remortgage options, but this does vary across the market.

This has resulted in lower income for me as lenders pay a much lower procuration fee on product transfers compared to remortgages.

At the end of the day, we just need to do what is best for our clients and if that means a product transfer and lower income, so be it.