15 months of continued growth.

The second charge mortgage market continues to grow with the value of new business reaching £116 million in November 2019, figures from the Finance & Leasing Association (FLA) show.

This is a rise of 17% from November 2018 with the number of new agreements rising by 14% to 2,594.

In the 12 months to November 2019 new business totalled £1.238 billion, 16% up on the same period the year before while new agreement numbers were up 19% to 27,747.

The second charge mortgage market reported a fifteenth consecutive month of double-digit new business volumes growth in November. The average value of second charge mortgages in November grew by 3% compared with the same month in 2018 to £44,530.

Buy-to-let landlords

Landlords beginning to utilise this method of raising capital which just did not happen in the past. Landlords with good equity within their properties have seen this route of raising capital as quick and very uncomplicated.

Lenders have seen the potential growth in this area, and they have responded very well, offering a good range of flexible loan deals on Buy-to-let properties. Two or three years ago there was only a small choice, plus the rates were a lot higher.

In the years gone by if a homeowner or landlord wanted to raise capital from the equity within their home brokers invariably recommended a re-mortgage. This situation is changing as all parties become more aware of the advantages of a second charge loan has to offer.

If you are looking to release funds tied up within your property it is strongly recommended to explore this type of loan as you could save a good deal of money, especially on legal fees.

Can we help?

If you would like to know more about this form of lending please do make contact and one of our independent advisers will be happy to assist. 

Second charge lending has increased!

Second charge lending has increased in the last twelve months, plus the number of homeowners taking out these specialist mortgages increasing by nearly a quarter.

The value of new business in this area of the mortgage market went up by 25.8% to £111 million in February 2020, according to new figures. Meanwhile, the number of new agreements increased by 24%.

The second charge mortgage market remained buoyant in March and April, as monthly new business reached more than £100 million for the second time this year.

Coronavirus – Looking to raise funds?

We are living in very strange times and many things are not clear, if you are looking to raise funds as and when this crisis is over it is strongly recommend getting the “ball rolling” sooner rather than later.

All experts are predicting there will be a huge surge of lending applications later in the year, so getting your requirements in place now would be a sensible move.

So, what are second charge mortgages?

A second charge loan is, quite literally, a second mortgage. It is a loan which is secured against your home in the same way as a standard mortgage. Homeowners can take a second mortgage out with another lender, so you can shop around to find the best deal.

The loan can be used a bit like a re-mortgage or personal loan to raise additional money for things like home improvements.

Commonly they are used by people who are already on a good first charge rate and don’t want to re-mortgage away from this to raise money. Others use it to avoid paying early repayment charges associated with re-mortgaging or because they have experienced credit problems and may therefore find switching to a new deal tricky.

February’s increase in second charge lending marks the ninth consecutive month of new business growth.

Need help?

If you are considering taking out a new loan against your property please get in touch with one of our fully qualified independent advisers who will be happy to guide you.