As we step into the new year, we are pleased to deliver the Right Mortgage & Protection Network members timely insights into the 2017 performance of the second charge mortgage sector.

You may have found 2017 to be a year where you became more involved in or aware of the need for specialist lending for your clients. This has certainly been seen in the performance of the overall specialist lending market, especially second charge mortgages.

Here, we witnessed a strong return to form, and prospects are looking good for 2018. Although the wider economy faces Brexit headwinds, there are real reasons to believe that second charges will continue to offer growth opportunities for brokers willing to get involved.

Highlights of seconds in 2017 included:

  • Lending reached £993m for the year up to October 2017, this is up 13% from the same point last year with 8 consecutive months showing growth.
  • Lending records were broken this year with several months exceeding £90m.
  • May 2017 achieved a post-recession record high of £94m.
  • Second charge new business increased by both average transaction value up 3% between March and October and volume of transactions, up by 11%

These trends confirm that an increasing number of individuals are turning to specialist financing options and for increasingly significant capital-raising.

So, to what do we owe the sector’s resurgence?

One reason could be that borrowers have needed to turn to debt financing with rising inflation, stagnant wage growth and tightened household incomes. A second factor is that people are using more short-term credit to cover day-to-day expenses. Finally, brokers becoming increasingly comfortable with second charge products, are therefore able to advise their clients accordingly.

 

Would you like to know more? Watch our videos to get up to speed.

The second charge market’s performance in 2017 gives us real optimism that this upward trend will continue in the months ahead.

Do you have clients with a need for a second charge mortgage? For more information, drop us a line or give us a call on 020 8731 5333.