Remortgage instructions decreased by 26% in March as lenders react to the heightened levels of uncertainty around the cost of living crisis, according to the latest remortgage data by LMS.

Data showed that there was also 28% drop in completed remortgages in March, which was “entirely expected” given the early repayment charge (EPC) peak at the start of April.

The most popular main aim when remortgaging was to release equity in property, cited by 29% of borrowers.

The survey by the conveyancing firm says 46% of borrowers increased their loan sizes in March, with average monthly payments lifting by £224.

It adds that 63% of those who remortgaged took out a five-year fixed-rate product, which was the most popular product for the month.

LMS chief executive Nick Chadbourne says: “While the figures show a drop in completions, this is entirely expected given the ERC peak at the start of April. The fact that the pipeline grew shows you just how many cases were there waiting for the ERC to drop off.”

“While remortgage instructions are also down month on month, this is most likely because many lenders have responded to heightened levels of uncertainty around the cost of living squeeze by pulling products from the market and evaluating affordability more closely.”

“They are also establishing what capacity they have across the board – underwriting, surveying and conveyancing – so it will be vital for the sector to work out how the supply chain can manage sustained volumes throughout the year.”

“Working closely with their suppliers, lenders will be looking to assist borrowers by providing competitive fixed rates to give surety of costs while dealing with such pressure, and efficient collaboration between all parties will ensure the effective implementation of tech that can help speed up the entire remortgage journey,” he adds.