In addition, instruction volumes continued to rise, up 19.4% in January.
The cancellation rate increased by 0.6% to 7.72% in the first month of the year, and pipeline figures fell by 7.8%.
The average monthly payment decrease for those who remortgaged in January was £212.
A total of 48% of borrowers increased their loan size, and 54% of those who remortgaged took out a 5-year fixed rate product which was the most popular product length.
The most popular primary aim when remortgaging, at 29%, was to release equity in property.
The average loan increase post remortgage was £22,231, whilst the average loan decrease post remortgage was £10,906.
Nick Chadbourne, chief executive of LMS, said: “The steadying market is already having a positive impact on remortgage activity as industry capacity returns to normal levels and stakeholders have the necessary time to process remortgage cases at healthy rates.
“We can expect an incredibly busy next few months in both the purchase and remortgage markets which may run into early summer given the current turnaround times.
“COVID-19 has forced homeowners to re-evaluate their priorities in terms of space, location and accessibility, and these factors will continue to buoy the purchase market for months to come, and likely impact remortgage decisions too.
“However, the easing of social distancing measures will allow more staff to return to offices and give the industry the necessary resources and tools to process.”
