Second charge lending up 10 per cent but rebound slowing

  • 13/01/2021
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Second charge lending up 10 per cent but rebound slowing
Second charge lending hit £75m in November as the market continued to rebound although the rate of improvement slowed.


The total finance lent was up 10 per cent from October’s £68m, according to figures from the Finance and Leasing Association (FLA), with 1,857 transactions completed representing an eight per cent uplift.

However, these remained 35 per cent and 41 per cent respectively down on November 2019, which saw £116m lent and 2,594 transactions completed.

Fiona Hoyle (pictured), head of consumer and mortgage finance at the FLA, said: “The level of new business by value and volume in the second charge mortgage market continued to improve in November and the rate of contraction compared with pre-crisis levels continued to ease.

“In the eleven months to November 2020, new business volumes in this market were 40 per cent lower than in the same period in 2019.

“Lenders are continuing to do all they can to support customers during this challenging period. If customers are experiencing payment difficulties we encourage them to contact their lender as soon as possible.”

The impact of the coronavirus pandemic on the market remains stark with barely £200m lent in the three months to November and only £759m lent in the 12 months up to and including it.

This is in contrast to the £338m and £1.24bn lending completed in the three and 12-month periods respectively at the same point last year.


Contrasting figures

Figures compiled by Loans Warehouse have been more positive than those produced from the FLA, although the pair use different sources for their data.

According to Loans Warehouse in November £80m of second charge loans were completed, an increase of £9m on its October volumes of £71m.

And earlier this week the broker firm said it expected the market to be almost back to its pre-pandemic level in the first quarter of 2021.



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