The recent house price increases have caused many home owners who purchased homes between 2006 and 2008 to have adequate equity for remortgages.
According to HSBC, many homeowners are now taking advantage of the low interest rates by remortgaging. Research has indicated that homeowners who purchased homes in 2006 can have an increase of their equity share to 25 percent from the current 17 percent.
On the other hand, those who purchased homes in 2007 can have an increase of their equity share from four percent to 13 percent. Home borrowers will need a reduced “loan to value” on a new mortgage, which will qualify them for more affordable interest rates.
These increases in the past years are good news for many homeowners. Whether the homeowners want to benefit from higher interest rates in the previous year or are concerned that the recovery of home prices may not continue, now is a good time to remortgage and capitalise in the improved equity level.