Second charge lending in December comes to £118m – Loans Warehouse

According to Loans Warehouse latest secured loan index, this continues a trend of growth in the market with total second charge lending in 2021 pegged at £1.18bn from over 27,000 loans.

It was hinted in December that lending had passed the £1bn mark for the time since 2019 and should be seen as a “benchmark of success” for the market, according to Loans Warehouse’s managing director Matt Tristram.

The report added that Q4 2021 had the highest lending for the quarter on record since 2008.

December’s lending was down £18.6m compared to the prior month, however, the report said the figures showed a “continuation of a boom in second charge lending” that had not been seen since before the credit crunch.

It added that one lender reported record completion figures, which the report said was a “rare event for the festive period”.

Around 84 per cent of loans were below 85 per cent loan to value (LTV). The report attributed this to the fact that the pandemic impacted the level of equity available to borrowers, so second charge lending was an alternative method for raising capital.

Completions in December came to 2,500, which was 18 per cent down on November figures.

However, the average loan size rose to £47,934, which was up from November’s record breaking £45,399.

The report added that 40 per cent of the loans in December were for consolidation and home improvements, 37 per cent were solely for consolidation and 17 per cent of loans were for home improvements.

Average completion times, from submission to completion, were 23 days, which was 0.4 days slower than November.

The average term was 16.4 years.

This report collates information from Optimum Credit, Oplo, United Trust Bank, Together Money, Masthaven, Norton Home Loans, Equifinance, Evolution Money, Spring Finance and Selina Finance.