Boost in second charge mortgage lending

Christina Hoghton
Written By:
Christina Hoghton

Borrowers are turning to secured loans as an alternative way of raising funds to a remortgage or personal loan

The number of new second charge mortgages taken out in June was up for the fourth month running, said the Finance and Leasing Association.

The value of lending also saw a significant increase, with £259m-worth of second charge loans taken out in the three months to June.

Fiona Hoyle, head of consumer and mortgage finance at the FLA, said: “In June, the second charge mortgage market reported its fourth consecutive month of growth, with new business up 33% by value and 22% by volume. The number of new second charge mortgages in the first half of 2017 was 10,401, 11% higher than in the same period in 2016.

“Second charge mortgages can be particularly useful when a customer wants to raise additional funds but does not want to change their existing first mortgage – especially where this involves additional costs. They are regularly used by customers to fund home improvements.”