Second charge mortgage new business volumes grew by 25% in July, data from the Finance & Leasing Association (FLA) has found.
The total value of new business through the month stood at £163m, marking a 30% increase on the previous year.
The number of new agreements was 3,364, a 25% increase when compared to July 2023.
Fiona Hoyle, director of consumer and mortgage finance and inclusion at the Finance & Leasing Association (FLA), said: “The second charge mortgage market returned a strong performance in July as consumers have become more confident in recent months about the economic outlook.
“This contributed to double-digit growth in new business volumes of 14% in the first seven months of 2024 compared with the same period in 2023.
“The distribution of new business by purpose of loan in July showed that the proportion of new agreements which were for the consolidation of existing loans was 58.8%; for home improvements and the consolidation of existing loans was 21.6%; and for home improvements only was 12.6%.
“As always, customers who are concerned about meeting payments should speak to their lender as soon as possible to find a solution.”
Matt Tristram, co-founder of Loans Warehouse, said: “The second charge market is back to its post-Credit Crunch peak.
“This is testament to the hard work carried out this year raising the profile of the product, excellent work by lenders making the process significantly more efficient for both brokers and customers, and the unusual situation where many consumers are still enjoying fixed rates on their main borrowing from 24 months ago with a rate starting with a one, that if they were to remortgage would increase to a four or five.
“This is forcing them to look at other options, of which a Second Charge is the best option – It’s a perfect storm producing results.”
