New figures released by the Finance & Leasing Association (FLA) show that second charge mortgage new business grew 8% by value and 15% by volume in March, compared with the same month in 2016.
Fiona Hoyle, Head of Consumer and Mortgage Finance at the FLA, said:
“The second charge mortgage market has faced significant change since transferring into the FCA’s mortgage regime in March 2016.
“The strong performance in March 2017 – the first month that new business volumes have grown since August 2016 – could be the early signs of a return to form for this important market.
“Second charge mortgages are a very useful product, with consumers taking them out for a variety of reasons – including home improvements, or paying the deposit or removal costs for a son or daughter moving into their first home.”
Harry Landy, Managing Director at Enterprise Finance, comments:
“We are confident that the second charge mortgage market will slowly continue to grow, as the uptick in today’s figures indicate. However despite this increase in month-on-month lending, we do believe that the sector isn’t yet reaching its full potential. In order for it to do so, there needs to be greater education for, and awareness of, second charge mortgages among advisers. This will equip them to best enable their clients to navigate the many financing options available to them.”
Table 1: New second charge mortgage lending
|Mar 2017||% change on prev. year||3 months to Mar 2017||% change on prev. year||12 months to Mar 2017||% change on prev. year|
|Value of new business (£m)||93||+8||238||-1||871||-3|
|Number of new agreements (No.)||2,017||+15||4,999||-3||19,185||-9|