Skipton adds a remortgage deal at 3.35% for customers with at least 40% equity in their home
Skipton Building Society recently introduced a product at 3.35% for remortgage customers with at least 40% equity in the home.
But, how has it been able to take this step and how does it see the remortgage market developing from here?
Mortgage Introducer reached out to the building society to find out.
How did Skipton introduce a remortgage product at 3.35%?
Jennifer Lloyd (pictured), head of mortgages and propositions at Skipton Building Society, said it is crucial lenders offer as much support as they can to ensure borrowers remain secure in their own homes through these turbulent times.
This can be achieved, she added, by looking at further opportunities to provide certainty and confidence in the ability to maintain payments.
“With the UK having seen strong house price index growth over the past two years, many borrowers may now fall into a lower loan-to-value (LTV) bracket than they expected,” Lloyd said.
The new range, Lloyd said, enables those borrowers in need of greater financial support in this current climate to harness that additional equity to support them over the two-year period.
This is accomplished, she said, by offsetting a lower interest rate and monthly payments, with a higher upfront fee, which can be added to their mortgage balance.
“This will help take some of the pressure off those borrowers’ monthly budgets, and give them some much-needed longer-term security beyond what the Mortgage Charter currently offers,” Lloyd said.
Signing the mortgage charter, Lloyd said, was just one step in the lender providing support, but the building society believes it can do more for its borrowers.
“It is important we think differently on what further support could be made to make a real difference for our members, who may be facing a future of financial difficulty due to the limited options on the market available to them,” she said.
Lloyd added that the building society’s borrowers have benefitted from strong growth in house prices over the last couple of years, earning them additional equity in their properties.
For those who are financially stretched, she believes this is a good time to consider if they can make that equity work for them.
“We will always work directly with our borrowers to understand their personal situations and work with them on a solution that is most suited to them and their circumstances,” Lloyd said.
This range of mortgages, Lloyd said, presents another option for the lender’s members, however she added that it is not to say that it will be right for everyone.
How will the remortgage market develop in the near future?
With elevated mortgage rates, Lloyd said customers are inclined now more than ever to look for the best mortgage deals.
However, she said market expectations indicate rates will continue to reduce, though the impact of higher rates will still have an effect on a number of homeowners as they come to the end of their current deals.
“We expect to see, in the near future, even more lenders starting to think outside of the box and finding new ways to innovate with products, to best support those customers who may see themselves struggling in the high cost-of-living environment we are in today,” Lloyd said.
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