Second charge mortgage lending hit £93.3m in September as more intermediaries wake up to the potential of the products ahead of the Mortgage Credit Directive, according to the latest Enterprise Finance Secured Loan Index.
With the Financial Conduct Authority recently suggesting that brokers will lose the ability to call themselves independent if they don’t offer both first and second charge mortgages from March 2016, monthly completions rose by 6% in August and then a further 3% into September.
Harry Landy, sales director of Enterprise Finance, said: “Preparations for the implementation of the European Mortgage Credit Directive continue apace and brokers are realising that if they don’t offer second charge mortgages in addition to first charges, they are not only potentially doing their clients a disservice by not considering the full range of potential options, but won’t be truly whole of market and may have to become restricted advisers.
“With this in mind, we’ve seen the volume of secured lending increase steadily throughout the year as awareness around the new regulatory regime increases and brokers wake up to the fact that second charge mortgages are just as viable an option as remortgages or further advances in many instances.
“Monthly secured lending has more than doubled since the beginning of 2013 and once it comes under the same jurisdiction as first charge mortgages, is only set to increase further.”
This continued improvement annual second charge mortgage lending now stands at a fraction over £900m and should pass the £1bn mark in the early part of 2016.