"Brokers and their clients are highly responsive to the current market conditions, with clients increasingly attentive to the timing of their mortgage decisions."
During our latest, and thirteenth, Mortgage Lender Benchmark, we asked brokers about their clients’ current preferences and behaviour when seeking a new mortgage deal.
Clients are starting the process quicker
As well as showing a clear preference for shorter mortgage deals, clients appear to be highly proactive about securing their next mortgage deal – acting well in advance of their current rate expiring.
Over half of brokers (52%) said that their clients began the remortgage process more than three months before their current deal’s end date. This indicates a strong desire for clients to consider their options early, likely motivated by the volatile interest rate environment and recent rate cuts. This proactive approach also suggests that brokers are contacting clients well in advance of their mortgage deal expiring, and clients themselves are becoming increasingly aware of the potential cost savings from acting early.
31% of brokers reported that their clients started the remortgage process three months before their current deal ended, demonstrating a solid level of pre-planning, albeit on a slightly shorter timeline. Interestingly, only 13% of clients began the process two months in advance. And even fewer – just 4% – waited until one month or less before their current mortgage expired. These low percentages suggest that a last-minute approach to remortgaging is less common, likely down to a combination of brokers contacting their clients sooner, and increased awareness amongst clients. Plus, the lenders themselves are responsible for making timely contact with their customers about switching their mortgage deal, which may trigger earlier remortgage activity.
Shorter terms are preferred
Looking at the most popular length of fixed rates, there’s currently a clear trend towards shorter terms. 58% of brokers said that most of their clients have chosen a two-year fixed rate in the last six months, suggesting a strong preference for flexibility in the current climate. Meanwhile, 38% of clients chose five-year fixed rate deals. This suggests that a considerable number of clients still value mid-term stability and are comfortable securing a rate for a more moderate period. These clients are likely balancing potential future rate changes with a desire for manageable monthly payments.
Meanwhile, a mere 1% of clients opted for ten-year fixed rate deals, showing that very few are willing to commit to a rate for the long-term. This strengthens the argument that many clients feel rates may improve, meaning committing to a longer fixed rate could ultimately backfire. Finally, only 3% of clients chose other fixed rate terms, with three year and lifetime being the most popular options of this small segment.
Clients are generally locking in their deals early
With clients looking to consider their options earlier, it would seem logical that most of them also go ahead and lock-in their next deal sooner, too. The results somewhat back up this theory. When looking at the last six months, 50% of brokers said that they’d seen the trend of clients locking in remortgage deals earlier. This strengthens the idea that clients are growing more strategic in their approach to remortgaging and becoming savvier about the benefits of financial planning. Of course, the recent economic uncertainty and subsequent slight reducing of rates would have also played a part.
Interestingly, a significant proportion of brokers (41%) said they saw no difference in when clients secure their next deal. This suggests that while early lock-ins are generally popular, this trend may not be universal or may vary according to client demographics or circumstances. It might also indicate that clients were already locking in early deals in the first place. Meanwhile, 9% of brokers said they were unsure whether clients were locking in their next remortgage earlier, highlighting that some variability or inconsistency remains in client behaviour.
Final thoughts
Overall, the findings show that brokers and their clients are highly responsive to the current market conditions, with clients increasingly attentive to the timing of their mortgage decisions. The strong preference for shorter fixed rate terms suggests that clients are reluctant to make long-term financial commitments, instead favouring
the flexibility that shorter terms provide.
Furthermore, the proactive approach to starting the remortgage process well in advance reflects a shift toward careful financial planning, with clients seeking to benefit from securing their next mortgage deal early. As the market conditions continue to change, it’s likely that this proactive approach to mortgage planning will become even more prevalent, with brokers looking firmly in the direction of lenders to provide solutions for their clients.
