Bridging loan firm, SoMo, has reported a 25% increase in its second charge lending, which now makes up almost 50% of all its loans.
While latest data from the Finance & Leasing Association reported that second charge lending has recently returned to pre-pandemic levels, SoMo’s second charge lending remained consistent throughout and has grown by a quarter post-pandemic.
SoMo’s head of underwriting Rob Johnson (pictured) said: “Second charge lending is a niche market and we see a lot of potential in London and the South East, which mainly concentrates on first charge lending.
“We want to educate brokers about the potential of second charge lending; the message coming from our network is that they’re surprised by the demand and delighted that this type of loan can be used for a variety of purposes.
“Coming out of the pandemic, we’ve been working with many businesses looking to raise funds by way of second charge loans – some to keep their businesses afloat and others to jump on new opportunities that have arisen.
“Whether it’s to purchase a buy-to-let property, pay off a tax bill or simply grow a business with new premises, materials or marketing, we’re finding brokers, intermediaries and clients are turning to SoMo because we’re able to offer a specialist and solution based approach to Second Charge lending, a leading LTV of 70% against the OMV and rates from 0.6% pcm.
“As a business overall, we’re lending more month-on-month and year-on-year and we see second charge loans to be an important part of our growth strategy.”
This year, SoMo – a specialist in second charge loans – will open a new office in London, in part to work with London-based business development managers and Underwriters and capitalise on the second charge market.
