The Bank of England’s Monetary Policy Committee (MPC) has raised the standard base interest rate during the last three consecutive meetings. The cost of borrowing becoming more expensive each time the rate increased. Because of this, homeowners have been seeking to escape paying more than necessary by shopping for remortgages. Through a remortgage, not only could a homeowner discover a low interest rate in which to save money, but other benefits as well.

The UK economy is putting a strain on households. Inflation along with rising fuel and energy costs are taking money out of budgets that had already been strained due to the global pandemic. Experts are encouraging homeowners to take advantage of an opportunity they have to save money and build in a financial safety net against rising interest rates.

The UK housing market has been in rapid movement upwards for a long time and during a time when it was unexpected. The global pandemic had been expected to slow down most markets, including property buying. However, it sparked strong demand from home buyers. First time buyers and home movers were buying rapidly and in markets that had received little attention such as those in the country due to buyers seeking property with more space. 

Households are facing financial strains from many areas. Fuel and energy costs are causing issues and inflation is taking extra out of pockets on more and more goods. Borrowing is more expensive as well with the Bank of England’s Monetary Policy Committee (MPC) increasing the standard base interest rate upward during each of the last three consecutive meetings. Due to the tightening on consumers, the risk in lending is also higher and this could be setting in place a tighter lending environment for borrowers making it not only more expensive but harder to come by.

Home buyers are not going away, at least not yet. The drive to buy property may have been spurred by the global pandemic, and in some cases it could still be the motivator for buying, but there are more factors at work now pushing the buying demand. The biggest push to buy is likely to escape rising interest rates. Therefore, as much as there is a demand for buying, there is perhaps a demand for borrowing before it becomes more expensive.

Homeowners are seeking the opportunity to remortgage as a path to escaping higher interest rates. According to several reports, more homeowners with many months left in their current term are in search of remortgages. Rather than face the interest rates that will be available when their terms expire, they are instead choosing the opportunity to remortgage now and obtain an interest rate level that could be cheaper.