A new survey by Paragon has revealed that 83% of mortgage intermediaries reach out to their customers to discuss remortgage options once a they reach the end of their initial term.
Paragon found that in terms of contact, half of intermediaries said they always contact customers as they approach the end of their current arrangement and one third said they usually do so.
On average, intermediaries said that 43% of their customers chose a product switch with their existing lender rather than remortgaging when their mortgage reached maturity.
Interestingly, two thirds of intermediaries said they would never or only rarely recommend a product swich at a higher rate, while one third said that they would do so in certain circumstances for the benefit of convenience.
John Heron, managing director of mortgages at Paragon, said: “These findings demonstrate the important role intermediaries play in encouraging competition and choice in the mortgage market, offering a proactive prompt to customers to review their options at the end of their current deal.
What’s interesting is how intermediaries encourage customers to weigh the benefits of a switch product with an existing provider against a remortgage with a new lender when deciding what action to take.”