Legal & General: Remortgaging is "as dead as a dodo"

Date:Monday 26th October 2009
Author: Susanna Kavka

The remortgaging market has been dubbed "as dead as a dodo" by the director of mortgages at Legal & General, who predicted that the current state of the sector looks unlikely to change in the near future.

Responding to the latest figures from the British Bankers' Association (BBA) - which revealed that loan approvals for house purchases have reached levels last seen towards the end of 2007 - Ben Thompson said that there is "little incentive" for borrowers to move from their standard variable rates if the bank base rate remains low.

He added that mortgage network advisors may have been "a tad optimistic" when - three months ago - they predictedthat remortgages would constitute a minimum of 60 per cent of their business by this time.

The data from the BBA revealed that, despite an annual growth of 4.6 per cent in homeowner loans, households appear to be choosing to reduce their borrowing and amass deposits instead.