It follows a slump in September where figures were largely unchanged from 2016 and continues the significant growth of the sector earlier in the year.
According to Finance and Leasing Association (FLA) data, 1,880 second charge transactions were completed in October with a value of £85m – up 19% and 20% respectively compared to October 2016.
The figures were also notably up on September 2017 where just 1,693 transactions were completed totalling £77m.
This data will be particularly encouraging as after a strong start to the year the second charge market has been slowly sliding since June.
Enterprise Finance managing director Harry Landy noted that the market had recovered from its blip and was continuing its upward trajectory that saw six months of consecutive month-on-month growth from March to August.
“Whether it is to fund renovations, help a family member with a deposit, or consolidate household debts, we’ve seen more borrowers taking out second charge mortgages – many at a higher value – and this has led to a strong year for the sector,” he said.
“We are cautiously optimistic that this increase will continue into next year, but it is important that brokers are aware of the range of specialist financing options around, and can therefore provide tailored advice to borrowers.”
Personal finance growing
Overall, consumer finance new business grew 10% in October, compared with the same month last year, the FLA added.
Credit card and personal loan new business together grew by 13% while retail store and online credit new business increased by 3%.
FLA head of consumer and mortgage finance Fiona Hoyle, said: “The second charge mortgage market reported growth in October, with new business up 20% by value and 19% by volume compared to the same period in 2016. The number of new second charge mortgages was 1,880.
“A second mortgage continues to be a useful option for customers seeking to raise additional funds without wanting to change their existing mortgage, and are regularly used to fund home improvements.”