Second Charge Lending
Second charge business volumes up by 25% in July – FLA
The number of new second charge agreements completed in July totalled 3,364, 25% higher than the same month last year, data from a trade association found.
Figures from the Finance and Leasing Association (FLA) revealed there was a 30% annual jump in the value of new business, which amounted to £163m.
Business was also up year-on-year in the three months to July, with a 13% increase in new agreements, which totalled 9,340 over May to July. The value of new business rose by 18% to £450m.
For the 12 months to July, there was a more modest 3% yearly rise in the number of new agreements, which came to 32,949 for the period. The value of new business increased by 4% to £1.53bn.
Fiona Hoyle (pictured), director of consumer and mortgage finance and inclusion at the FLA, said: “The second charge mortgage market returned a strong performance in July as consumers have become more confident in recent months about the economic outlook.
“This contributed to double-digit growth in new business volumes of 14% in the first seven months of 2024 compared with the same period in 2023.”
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Second charges used to consolidate loans
Hoyle added: “The distribution of new business by purpose of loan in July showed that the proportion of new agreements [that] were for the consolidation of existing loans was 58.8%, for home improvements and the consolidation of existing loans was 21.6%, and for home improvements only was 12.6%.
“As always, customers who are concerned about meeting payments should speak to their lender as soon as possible to find a solution.”
This recorded rise in activity comes after Guy Nyirenda, head of commercial and specialist lending at Altura Finance, noted increasing demand for second charge lending.