Mortgage refinancing is expected to grow to £103 billion by 2026 and £110 billion by 2027, while product transfer growth is expected to slow after record volumes in 2025, the Intermediary Mortgage Lenders Association (Imla) reveals.
Product transfers have soared in recent years as interest rates rose sharply and affordability tightened, but Imla expects this balance to shift as borrowers increasingly have the ability to switch lenders.
Imla says this change reflects a market gradually emerging from the most restrictive phase of the interest rate cycle.
It also highlights that continued innovation from lenders and a more proportionate regulatory environment are expanding the range of options available to borrowers nearing the end of fixed rates.
With an estimated 1.8 million borrowers set to move away from fixed rates by 2026, Imla believes the coming period will mark a return to more active refinancing decisions, rather than the standard reliance on product transfers of recent years.
Imla managing director Kate Davies said: “The reemergence of mortgage refinancing is a healthy development for the market. While product transfers have played an important role during a period of limited affordability, they may not always provide the best long-term answer for borrowers whose circumstances have evolved.”
“For many people, refinancing a mortgage is a natural opportunity to take stock and reassess their broader financial position. Income, expenses, family circumstances and future plans can all change in nuanced ways over the life of a mortgage, and it makes sense that those changes are reflected in the advice and solutions borrowers receive.”
“As affordability improves and lenders continue to innovate within a robust regulatory framework, many borrowers will now benefit from having a professional broker scour the entire market for the most suitable mortgage solution, rather than simply defaulting on another product with their current lender.”