Record breaking year for second charge lending
2022 was a record year for second charge lending, despite a slight slowdown in lending volumes over the past couple of months.
Loans Warehouse has published its latest Secured Loan Index for November 2022, and found that second charge lending dropped for the fourth month in a row. £135.5m was loaned over the course of hte month.
However, during the year as a whole, the industry has recorded the highest annual figures since 2007. Second charge lending volumes are up by 36.82 per cent in the year to date, year-on-year, with £1.6bn already loaned for 2022.
Read more: Second charge lending up 45pc year-on-year
Loans Warehouse observed that lending at higher loan-to-values (LTVs) has started to drop slightly, with just 13.74 per cent of loans completed in November at 85 per cent LTV or above.
Furthermore, the average term time of a secured loan has increased by a year, reflecting the ongoing cost of living crisis.
Read more: Second charge lending hits new high
“The average term of a secured loan has increased by 12 months, potentially linked to lenders’ affordability being stretched more than ever before in recent times,” said Matt Tristram, managing director of Loans Warehouse.
“Finally, many lenders have significantly improved their completion time, likely a result of a dip in the record-breaking lending levels seen across the summer months.”
Read more: SoMo sees 25pc rise in second charge lending