Second charge lending totalled £161.36m in July this year – the highest figure recorded since the 2009 financial crash.
This figures represents a 12.54% increase on June’s lending figures, and an annual increase of 59.34%. This is 3.75% higher than the previous record amount, lent in March this year.
Figures reported directly to Loans Warehouse from second charge lenders show there were a total of 3,337 second charge loans completed in July, a 11% increase on the previous month.
Given the precarious state of the nation’s finances, these figures indicate that more people are taking out these loans to help with debt consolidation, with almost 8 out of 10 second charge mortgages now used, at least in part, for this reason.
In total 37.59% of loans were for debt consolidation with a further 40.48% for a combination of home improvements and debt consolidation. Loans Warehouse said there had been an increased number of loans in this second category.
Loans Warehouse says these figures indicate that the annual growth in this second charge market continues to surpass all records since the global crash and subsequent credit crunch, with the market currently tracking to lend over £1.7bn in 2022.
Completion times continue to increase slightly, but Loans Warehouse says this is likely to be linked to the sheer volumes of business being written and businesses adjusting their recruitment to meet demand. In total the average time from submission to completion time was just under 19 days.
The data shows the average term for these second charge mortgage was 14.87 years, with 83% of these loans still under 85% LTV of the property.