Second charge mortgage lending continues growth in May

Second charge mortgage lending continued to grow by value and volume in May, on both a quarterly and yearly basis.

Figures from the Finance and Leasing Association found that the value of new business in the sector was £87m in May, up 26 per cent on the same month last year.

For the three months to May, lending was worth £259m, up 25 per cent on the previous year, while for the 12 months to May lending reached £917m, up 3 per cent on the same period the year before.

There were 20,016 new second charge agreements in the 12 months to May, up 2 per cent on the 12 months to May 2016.

FLA head of consumer and mortgage finance Fiona Hoyle says: “Second charge mortgage new business has ebbed and flowed over the past year, which was to be expected following the significant changes brought about by the market’s transfer into MCOB in March 2016.

“While the market is still in the bedding-in process, in the first five months of 2017 new business was up 12 per cent by value and 9 per cent by volume, and May witnessed the third consecutive month of growth.

“Customers are borrowing for a wide range of reasons, including renovating or extending their property.”