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TODAY'S OTHER NEWS

Second charge lending nears £1 billion

Second charge mortgage lending is set to top £1 billion this year with £93 million worth of monthly secured lending in September alone.

Strong autumn transactions has pushed the annual total above £900 million.

Growth has been driven by the looming Mortgage Credit Directive (MCD) implementation date which is compelling brokers to consider second charge mortgages in more scenarios

Secured lending activity soared to £93.3 million in September as more intermediaries wake up to the potential of the products ahead of the MCD, according to the latest Enterprise Finance Secured Loan Index.

The Financial Conduct Authority recently suggested 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.

This means monthly gross secured lending is now a third higher than it was in September 2014.

Harry Landy, sales director of Enterprise Finance, said: “Preparations for the implementation of the European MCD 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.”

Landy said 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 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.”

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