Remortgaging rush set to continue claims TSB

Remortgaging rush set to continue claims TSB
By remortgaging, homeowners stand to save up to £96 per month on average, which can make a huge difference to family finances

A new report and survey from TSB has claimed that the remortgaging rush is expected to continue in 2017, with up to 31% of eligible homeowners planning to cash in on low interest rates.

According to the report, 25% of those plan to act now and remortgage in January. The potential savings they could be making, however, are being underestimated by nearly half.

TSBs survey of 2,000 homeowners found the average saving they expected to make from remortgaging their property was estimated at £49 a month. This compares with an actual average of £96 per month, or £2,300 across the life of a two-year fixed term on a £100,000 mortgage.

33% of JAMS (homeowners who identified their financial situation as ‘just about managing to cover monthly costs and outgoings) are planning to remortgage in 2017, with the majority (88%) doing so to free up monthly income, lock in at a fixed rate to better manage their money, or take advantage of the low interest rate environment.

Ian Ramsden, Director of Mortgages at TSB, said “Mortgage payments are often the biggest outgoing for many households. By remortgaging, homeowners stand to save up to £96 per month on average, which can make a huge difference to family finances. It could mean being able to afford a family holiday, carry out much needed home renovations, or simply help ease the pressures on household finances each month.”


TSB, which has witnessed a 27.5% increase in remortgage applications in 2016 compared to 2015, has launched its Stay Nation Britain report to explore the outlook for remortgaging in 2017.

By remortgaging at a lower fixed rate, homeowners have been able to free up extra cash for other uses:

Go on holiday:  39% would use the extra money to go on holiday, and 24% of these homeowners said they would go on three or four holidays in the year with Greece and Florida proving popular.

Higher mortgage repayments: 37% of those surveyed say they would use the extra money to overpay their mortgage payments, with the aim of becoming mortgage free faster.

DIY:  30% plan to carry out DIY jobs and one in five 21% would use the cash for a major home renovation like a loft conversion or extension. These plans include adding more bedrooms for a growing family 21%, creating space for a home office 13% and making their home open plan 16%.

Spruce up the garden: 16% would spend the money on doing up their garden, with most wanting new paving or raised flower beds.

Big ticket item:  A further 11% would buy a big-ticket item like a fridge or new TV.

Buy a new car: 9% would buy a new car with around half (48%) opting for a family sized car.

Despite these potential savings, some homeowners remain unaware of the opportunity altogether. More than half (54%) aren’t able to correctly identify the Bank of England base rate as 0.25% and 15% of homeowners who aren’t considering remortgaging say they won’t be doing so because it’s too much effort or it hasn’t crossed their mind.

Ian Ramsden, continued: “Remortgaging might not be right for everyone, but it’s important to understand your options. It doesn’t have to be complicated or time consuming to remortgage so it’s well worth investigating if people are looking for ways to make their finances go further in 2017. At TSB we’ve helped almost 6,000 people remortgage onto lower rates since the Bank of England lowered the base rate.”

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Latest Comments

MBM Homelets
MBM Homelets 23 Mar 2017

Although this is a very positive step, there is little or no guarantee of the standard of workmanship employed by the tenants. We have had experience of a professionally decorated property being ' painted'...

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ajay
ajay 21 Mar 2017

How is the "robust evidence" looking now?

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NathanG
NathanG 20 Mar 2017

I've been watching the series so far and am completely baffled by the cases that were presented. Though, I don't think that we can protect ourselves from every scam possible - it will just make the scammers...

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Landlady14
Landlady14 01 Mar 2017

You would think so Niraj Shah! My experience only proves that there are varying qualitiers of professional in all aspects of property letting. None of the ones I have dealt with, from letting agents to...

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Mark
Mark 01 Mar 2017

Thanks for this article. Hopefully one day everybody's lifestyle will be eco-sustainable.

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Ben Taylor
Ben Taylor 28 Feb 2017

I was convinced that London was the most expensive!

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Alan Read
Alan Read 28 Feb 2017

Australia are leading the way in this I think. The trouble with Britain is we don't get enough sun to make use of solar power.

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James Powell
James Powell 27 Feb 2017

This is a very good news.

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DanHumphreys
DanHumphreys 27 Feb 2017

It sounds like a good idea. Anything to help the younger generation get a foothold.

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Matt
Matt 20 Feb 2017

Is this fake news?

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Matthew Hollywood
Matthew Hollywood 07 Feb 2017

Matthew Hollywood - Director Mishon Mackay Land & New Homes - Brighton The shortage of New Homes is in part effected by the lack of land sales. Land sales are held back because there is a disparity between...

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CommercialTrust
CommercialTrust 30 Jan 2017

Hi Graham, Would be interesting to see the above figure calculated against an investment via a Lt Company /SPV structure and if the investor found themselves pushed in to the higher tax bracket. Mortgage...

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