The last three years has seen second charge lending increasing in stature as homeowners become aware of the huge cost of the “pay day loan”. For many years this form of loan was something clients only did as a last resort due to the high costs compared to a re-mortgage. This has changed dramatically  recently as lenders have recognised the potential this form of lending has.

Interest rates have been reduced and are now in line with the average mortgage. Another huge plus is the low cost of setting up a second charge loan along with the speed of completion.

Who can benefit’s from second charge lending:

• Their client is in a tie-in period and does not want to pay a large penalty
• Their client needs funds very quickly
• Their client is or has been in arrears with their current lender and wants to avoid disturbing their current low rate for sub-prime rate
• They can’t get the income multiples they need for their client
• The client has an interest only mortgage and does not wish to remortgage to capital & repayment
• Their client is benefiting from a low SVR and does not wish to disturb their current product

Most common reasons for a second charge loan:

• They wish to consolidate their outstanding loans and credit cards
• They wish to carry out home improvements
• They are looking to inject cash into their business
• They have had adverse credit and wish to speak to a company who understand their situation
• They are self-employed and wish to raise finance for one of the above

Can we help?

If you would like more information on how this type of loan could help you pleased do make contact with one of our advisers. https://www.second-charge-loans.co.uk/

The second charge sector continued to shake off post-Brexit troubles, with new business volumes in the traditionally-quiet August and September up 6% on 2015.

A report – drawing on data from the Finance and Leasing Association – shows that in July the total value of monthly second charge lending actually increased by 4% from £70m in June to £73m, post-Vote.

On an annualised basis, the market has consolidated at just under £900m (£889m in the 12 months to August) of gross lending after a period of prolonged growth throughout 2015. Experts say that there are several reasons why the outcome of the Referendum failed to dent an increase in second charge lending. The economic uncertainty resulting from the vote may have encouraged more borrowers to consolidate their debts, to make their payments more affordable and to avoid potential future shockwaves.

Ahead of the referendum, consumers were increasingly dependent on unsecured debt as a source of finance, with Bank of England figures showing consumer credit had risen £1.3bn month-on-month in April.

With falls in available interest rates being a feature of the market over the summer, second charges became more attractive options in July and August, and this will continue as rates below 4.5% have arrived on the market.

Can we help?

If you are looking to raise a secured loan please do contact us and one of our qualified advisers who will be happy to guide you. https://www.second-charge-loans.co.uk/contact/