Smart Money reports trend in consolidation loans

Smart Money has reported a surge of broker enquiries for clients who want to better manage their family budgets, in response to the financial impact on families and individuals caused by COVID-19.

The Cheshire-based specialist packager and distributor revealed it is seeing more personal budget financial management enquiries compared to straight debt consolidation requests.

Smart Money is a specialist finance broker that provides access to second charge loans, buy-to-let, bridging finance as well as first charge loans.

Managing director, Paul Crewe, suggested that consolidation loans are “tailor-made for a second charge application”.

“While those are increasing, many more recent enquiries are on behalf of clients looking for options as to how they can manage their budgets better,” Crewe said.

“Incomes have dropped due to furlough or been lost temporarily as businesses have cut back, but costs have stayed the same and broker customers are looking to see how they can reduce their monthly outlay to better match the new income reality.

“These applicants would not consider themselves to be ‘in debt’ when in normal circumstances they can easily afford their outgoings.

“The big factor to remember is that in many cases, as the pandemic restrictions ease and the economy picks up, income levels are going to improve quickly and customers do not want to be saddled with a long-term remortgage scenario, when a more targeted second charge loan can deal with the specific issue, is more flexible and has no upfront fees, such as valuation and legal costs.”

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