Conveyancing firm LMS has reported signs that the remortgage market is stabilising in its latest update on activity.

The company says that new remortgage instructions in the week commencing April 6 were down by 14 per cent on the previous week and by 19 per cent on the week commencing March 16, when lockdown measures were first announced.

However, it says that completions returned to benchmark levels for this time of year reflecting a peak in the expiry of early repayment charges in the first week of the month. 

Completions in the week commencing April 6 were 22 per cent higher than the week commencing March 23, suggesting that lenders and conveyancers are acclimatising to the new processes necessitated by working under lockdown.

LMS says that pipeline activity coming into April was 6 per cent higher than the same point last year and it expects growth to continue until the start of May, in line with seasonal trends.

The company says there has been a 35 per cent increase in cancellations, which is expected given many borrowers are facing changes in employment and income as a result of covid-19.

However, it says the baseline for cancellations in real terms was already very low, so the increase only accounts for less than 1 per cent of all remortgage transactions.

LMS chief executive Nick Chadbourne says: “There is cause to be optimistic when looking at both yearly comparisons of our key indicators and the upcoming pipeline data. 

“For borrowers looking to remortgage, the industry remains firmly open for business as usual.

“Initial positive signs for instructions from the start of the month have carried through to the middle of April, and [the expiry of] ERCs will continue to sustain volumes through to May. 

“As process issues continue to be improved, the hard work of parties all across the remortgage journey should see cases return to near normal levels, and pipeline data should get healthier still. 

“More restricted access to redemption statements and extended lender timelines remain factors to be dealt with, but progress is being made and the market keeps moving forwards.

“In a positive sign for remortgaging, combined cancellations and completions ran below instructions at the end of last week. That means the pipeline is beginning to grow and should sustain the market through the coming months. 

“As we move further through this crisis, we expect the remortgage market to remain strong and much of the work from lenders and conveyancers to update and digitise their processes will result in stronger businesses and a stronger industry for years to come.”