Second charge lending continues to grow in stature month on month as homeowners look for loans at affordable rates.

A recent survey of homeowners looking to borrow found in order of priority:

Survey findings

One of the big appeals of a second charge loan is it meets all the surveys key facts such as costs and speed.

On average a second charge loan is completed within 15 working days, this does of course vary dependant on the complexity. This financial year has also seen a significant reduction in set up costs plus interest rates are at the lowest ever recorded.

Second charge lenders have been quick to recognise the importance of speed in completing a deal as competition increases.

Borrowing money these days is a complex issue, a second charge loan could be just what you need but please do understand it may not suit every need. Best advice is to seek professional independent advisor assistance.

Need some assistance

If you think this type of loan could assist you with your future planning make sure you get the right one to suit your needs. There are many different lenders offering numerous second charge loans so please do call our qualified advisers who will be happy to help.

It has always been more difficult for self-employed people to get a mortgage compared to salaried employees. For that matter second charge loans have historically been somewhat harder to obtain for the self-employed as well.

At the heart of the issue is a tendency among self-employed individuals to not be able to satisfy loan companies looking to placate their own fears that the borrower will not be able to make good on his or her loan.

The good news is that things are changing – at least where second charge loans are concerned. This is particularly welcome news especially in these hard times we are currently living in. First Brexit and now Covid19!

Lenders are changing the way they do business in order to better serve self-employed applicants. For example, one specialist lender indicated that it had reduced its tax calculation requirements while others are changing their income criteria to make it easier for borrowers to document their income.

Second charge lenders can do a lot more to help the self-employed than primary mortgage lenders because they have much more flexibility. They are finally taking advantage of that flexibility to find ways to better serve self-employed borrowers.

Even more encouraging is the fact that lenders are coming up with a lot more specialised product to suit the majority of needs.

Need help or information?

If you would like to know more please do make contact and one of our independent advisers will be happy to assist.

The first reports on second charge financing of 2020 are suggesting that the rise in new business numbers recorded in 2020 will continue in 2021.

However, it is felt that the increasing popularity of secured loans did not happen without a lot of effort from brokers and lenders alike. What the new figures don’t reveal is just how much arduous work has gone into building business volumes by awareness. The second charge industry should be particularly proud of how it has succeeded in promoting secured loans to brokers and the public.

It is believed that the sector is more likely to grow at a measured pace rather than a “boom & bust” situation, backed by the increasing numbers of advisers who are now aware of where secured loans can sit in their advice process.

If you look closely at the positives a secured loan can offer a borrower, then it is easy to see why this form of lending is being welcomed by all.

Lender choices

The last 12 months has seen a substantial increase in the number of loan types available to a property owner. Not only this but new lenders have entered the market which has to be good for the long-term growth and stability of the second charge industry.

The broker

These days due to the vast choices open to the prospective borrower it is vital they get a professional adviser to point them in the right direction. With so many loans and re-mortgages available anybody contemplating taking out loan would be very well advised to seek independent broker advice.

Can we assist?

If you would like to discuss your future and present borrowing needs, please do make contact and one of our qualified independent advisers will be pleased to help. 

July 2020 saw the second charge mortgage market have its fourth consecutive month of growth, with new business up 19% by value and 14% by volume.

Second charge mortgages can be particularly useful when a homeowner wants to raise additional funds but does not want to change their existing first mortgage – especially where this involves additional costs. They are regularly used to fund home improvements.

The second charge market is performing very strongly, with four consecutive months of growth highlighting the sectors robustness. Consumers and investors have been hit by Brexit and now the Coronavirus, this has not been helped with more recent bad news about a resurgence of Covid-19.

However, this doesn’t seem to have deterred borrowers looking for alternative routes of financing.

The second charge market offers speed and flexibility coupled with very competitive interest rates, its little wonder consumers are taking to this route of financing. 

With the market continuing to accelerate, it’s very important that awareness and availability of second charge loans improves among brokers and consumers alike to help them secure the most suitable financing.

Help?

If you would like to know more about the second charge market and how it could potentially help you please do make contact.

More and more borrowers are turning to second charge loans as mortgage companies tighten controls on borrowing. Figures just released for the last quarter show “seconds” increasing to homeowners by 21% on the previous year, these increases are likely to be down to tighter controls from high street banks and other traditional lenders.

Brokers up and down the country confirm they are using second charges to assist clients in achieving their targets as high street lending becomes more and more difficult. Lending institutions up and down the country confirm, “secured finance is filling a funding gap which has appeared”. “Borrowers are finding it more difficult to obtain loans from mainstream lenders who are implementing tougher affordability restrictions”.

Some 70% of brokers reported a significant increase in secured loans in the last year and the trend seems to be continuing. Of the brokers survey 100% of them stated they found second charge finance extremely easy to use and quick to complete. One broker in Newcastle commented “We have used “seconds” in the past and now we are using them on a more regular basis”. “Clients in general are impressed with the efficiency and speed of completion a second charge loan offers”.

There is little doubt this form of loan should be taken seriously especially when you compare the interest rates being charged by unsecured lenders.

Like too know more?

If you would like to know more about second charge financing and how it could assist you please do get in contact and we will be happy to help.