Remortgage applications have surged as homeowners transition from ultra-low pandemic-era fixed deals to higher borrowing costs. New data from Stonebridge reveals a 46 per cent increase in applications during the first quarter of 2026 compared to the same period last year. This surge has driven overall mortgage activity up by 24.6 per cent year-on-year, even as demand for home purchases has dipped.
What Is Driving the Rush?
The spike is largely due to millions of borrowers coming off ultra-low fixed-rate deals taken out during the pandemic. In 2021, mortgage rates fell as low as 1.85 per cent. Today, rates remain significantly higher, leaving many households facing a sharp increase in monthly payments. UK Finance estimates that 1.8 million fixed-rate mortgages are due to end this year, adding to the refinancing wave already underway.
James Tatch, head of analytics at UK Finance, commented: “1.8 million fixed-rate mortgages are due to come to an end this year, which is driving increased numbers of customers refinancing these deals compared with those seen last year. While fixed rates continue to be the overwhelmingly popular choice, some may choose variable rate deals if they expect global volatility to subside, allowing rates to fall. Getting advice from a qualified mortgage advisor is essential if customers are unsure about which product is most suitable for their circumstances.”
Why Remortgaging Is Rising Now
The increase is not solely due to expiring deals. Interest rates had been falling earlier this year, improving affordability and boosting confidence. Average mortgage rates dropped from 4.74 per cent in Q1 2025 to 4.31 per cent in Q1 2026, according to Stonebridge, while remortgage borrowing rose 7.3 per cent year-on-year. This has encouraged borrowers to act, particularly those keen to avoid rolling onto expensive standard variable rates.
Rob Clifford, chief executive at Stonebridge, said: “We know many borrowers locked into attractive five-year rates during the pandemic. Now that so many of those consumers are reaching the end of their deals, we are naturally seeing huge demand for advice on refinancing options.”
Shorter Fixes and Tracker Deals
A clear trend is the move away from longer fixed deals. Two-year fixes now account for 65 per cent of mortgages, up from 52 per cent a year ago, while five-year deals have fallen to 29 per cent. This reflects uncertainty over the path of interest rates, with many borrowers choosing shorter terms in case rates fall further.
Fixed rates still dominate, making up over 94 per cent of the market. However, tracker deals are attracting more attention. Part of the appeal is price: the average two-year tracker rate is around 4.63 per cent, compared with 5.87 per cent for a two-year fixed, according to Moneyfacts.
What Do the Experts Say?
David Hollingworth of L&C Mortgages noted: “The majority of borrowers continue to prefer the certainty of a fixed rate and knowing exactly where they stand with monthly payments. However, with the sharp hike to fixed rates, there are more signs that some borrowers are wondering whether an initially lower tracker rate could be cheaper now and offer a chance to lock in at a later date.” Tracker mortgages move with the Bank of England base rate, so repayments can rise or fall. Hollingworth added: “Trackers are far more likely to be available without any early repayment charge, allowing a switch to a fix at a later date.”
Rachel Springall, finance expert at Moneyfactscompare.co.uk, said: “Amid the turmoil in fixed mortgage rates, borrowers might feel it would be beneficial to take out a tracker mortgage moving forward, but it’s worth seeking advice before applying. The most appropriate deal depends on the buyer’s preference: peace of mind with a fixed rate, or a tracker mortgage if they feel comfortable with potential changes. If the Bank of England base rate rises before year-end, tracker customers will face higher repayments.”
What Should Borrowers Do Now?
For anyone nearing the end of a deal, preparation is key. Most lenders allow you to secure a new rate up to six months before your current deal ends, protecting against future rises while keeping options open if rates fall. The right choice depends on your circumstances: a fixed rate offers certainty, while a tracker may suit those who can cope with payment changes.
Clifford added: “We’re likely to see a reversal in rate volatility in the second half of the year, and the popularity of variable or tracker rates might increase. If the energy crisis is short-lived, a variable product would allow borrowers to capitalise on a falling base rate once the conflict subsides. This is a time when impartial and expert mortgage advice is worth its weight in gold.”
