Monthly mortgage repayments jump £236 in September: LMS

Borrowers who remortgaged in September saw their average monthly payment jump by £236, according to LMS.

The conveyancing services company’s monthly Remortgage Snapshot adds that 50% of borrowers increased their loan amount last month to an average of £21,933.

The average mortgage amount in London and the South East was £279,689, while the average for the rest of the UK was £130,570, bringing mortgage amounts to 72, 6% higher in London and the South East than in the rest of the country.

The report comes after the ONS reported that inflation reached 10.1% in September. The Bank of England has raised the base rate eight times since December from a historic low of 0.1%, today’s increase brings it to 3%.

The mortgage survey indicates that the most popular product on the market was a five-year fixed rate loan used by 68% of customers, with 29% saying the main purpose of the mortgage was to free up equity in the property.

LMS Managing Director Nick Chadbourne said: “Mortgages still look strong in September despite a month of many changes. It’s no doubt a stressful time for borrowers as they face upward pressure on their mortgage payments, but the end of September is traditionally a big time for prepayment charge (ERC) deadlines.

“That typically means lower completions and higher pipelines as companies prepare to process these cases on October 1. The market volatility caused by the mini-budget also led to lower instructions as lenders immediately withdrew the products, so overall the stats show what we expected.

“With the ERC expiration date and the fact that those lucky enough to get a pre-budget rate will have their cases completed, we expect completions to resume in October, but it will also be likely a month of anomalies as the continued economic instability and changing policies will cause lenders to enter and exit the market with various products as appropriate.

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