Second charge lending predicted to grow 100% in Q4

Loans Warehouse has predicted that the second charge lending market will experience a 100% growth in the final quarter of 2020.

Figures from the second charge brokerage showed that prior to the coronavirus pandemic, second charge lending stood at a total £107m in February, but had fallen 81% by May to £21m.

However, Loans Warehouse revealed that the market has since shown signs of recovery, with second charge lending figures doubling to £43m by August – leading to the group suggesting the market figures will double again by the end of the year.

“Despite the pandemic, we have traded throughout the year and it is our opinion the opportunity in second charge lending has never been better than it is today,” commented Loans Warehouse co-founder, Matt Tristram.
 
“I’m confident that August’s results be at least doubled again before the end of year. Despite a rocky few months for the second charge sector, positivity has once again returned.”

Tristram highlighted that the market has been “plagued” with product restrictions at higher LTV levels and long delays, but suggested that increased demand will see many borrowers turn to second charge products in the months ahead.

“Competition between leading lenders will be the key driver which will see the second charge market double from the figures recorded in August before the end of the year,” he said.
 
“I expect to see September’s figures show a rise in lending to around £50m with October and November breaking the £80m barrier with ease.”

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