Santander expects mortgagees to fix in coming months

Almost one million homeowners on tracker or fixed-rate mortgages could be looking to remortgage in the next six months, it has been claimed.

According to Santander Mortgage's Remo Index, which monitors remortgaging trends on a monthly basis, 880,000 new deals could be negotiated - equating to 4,848 potential remortgages each day over the next six months.

The firm said those who are coming to the end of their mortgage deals in the next six months are increasingly disinclined to choose a tracker deal.

With the Bank of England expected to raise interest rates at some point this year, the number of people choosing to fix will rise from 20 to 23 per cent, Santander said.

Of those homeowners due to remortgage before June, only 13 per cent will opt for a tracker deal, compared to 33 per cent just two months ago, the firm added.

Phil Cliff, director of mortgage marketing at Santander UK, commented: "Borrowers have seen a large number of highly competitive fixed deals come on to the market recently and with many commentators predicting a base rate rise this year, homeowners now seem more inclined to play it safe with a fixed-rate deal."

Last week, Santander reduced the rate on some of its two-year fixed-rate mortgages by up to 0.4 per cent, offering 4.99 per cent on a two-year 90 per cent loan-to-value deal.

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2010-01-25 13:21:38 © Moneyextra.com