The statistics, worked up by master broker Enterprise Finance, revealed that the total amount lent on an annual basis now stands at £799m. In the 12 months to March 2014 total annual secured lending reached £672m.
Harry Landy, director of Enterprise Finance, said: “Monthly and annual improvements of almost 14% is further evidence that public attitudes to borrowing continue to improve as the economy recuperates to something resembling a clean bill of health.”
Landy said that if the market continues to grow at this rate, March 2016 will not be far off a billion pound industry.
“How smoothly the secured loan sector reacts to being regulated in the same manner as mainstream mortgages when the switch occurs next March will obviously be a determining factor in when that particular landmark is reached, but it shouldn’t represent a significant challenge to further growth.”
The index showed the average loan size to be 14% higher than January; now standing at £61,347 while the average loan-to-value is 56%.
Home improvements was the most common reason for releasing equity by way of a second charge, accounting for 54% of transactions. Debt consolidation was the second most popular reason.
“With cost of living concerns more muted than they have been previously, we are likely to see a continued trend of individuals using secured loans to finance larger projects and purchases rather than to finance more everyday expenses,” added Landy.
The Association of Bridging Professionals, the Finance and Leasing Association, the Association of Finance Brokers and master broker Fluent Money recently submitted a revision of the CeMAP qualification to the Financial Conduct Authority. The draft sections covered material relevant to second charge loans.
The working group want secured loans to be better represented in the qualification which the sector will have to obtain by September 2018.
The Enterprise Finance Secured Loan index is devised using a combination of Enterprise Finance’s own management information and data from trade bodies and lenders.
