Millennials more remortgage savvy than older homeowners

Posted on Wednesday, July 5 by Joy Tibbs

According to new research from L&C Mortgages, millennials in the UK are proving themselves to be financially savvy, particularly when it comes to their mortgages.

This may, in part, be due to the fact that millennials have to make the highest monthly repayments of any group, with average contributions of £908 per month as they deal with greater mortgage debt.

The lender found that 92% of 18 to 34-year-olds on the property ladder have a repayment mortgage deal, which means they are gradually chipping away at the capital. Around 69% have opted for a fixed-rate mortgage compared with just 35% of over-55s.

The research showed that 25% of millennials have remortgaged to get a better deal compared with just 18% of those aged 55 and over. Those aged 18 to 34 are most likely to have taken a remortgage deal to reduce their monthly payments (34%) compared with just 19% of those aged 55 and over.

David Hollingworth from L&C Mortgages said: “Staying on top of your mortgage payments is key to avoiding financial difficulty, and it’s imperative to make sure you don’t borrow more than you can afford.

“Our research shows that young people are, on the whole, taking the savvy steps needed to ensure they haven’t bitten off more than they can chew in terms of covering their mortgage payments.”

He added: “Our figures have found that only a small percentage of those over 55 have ever remortgaged for a better deal. Although some may be reaching the end of their mortgage, others may have found lending criteria has limited their choices.

“Lenders have limited the maximum age at the end of the mortgage to 70 or 75. However, some lenders are more flexible and it makes sense for the over-55s to follow the lead of the millennial generation, who seem to be taking a more active role in managing their mortgages.”

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