Secured Loan Index: Third-highest monthly lending figure recorded amidst financial uncertainty

The Loans Warehouse issue their latest Secured Loan Index, which shows third-highest monthly lending figure recorded amidst financial uncertainty.

Key points from publication:
    • Second charge lending totalled £160.4 million in September 2022, figures reported directly to Loans Warehouse from second charge lenders confirm.
    • This is the third-highest monthly lending figure of 2022 but a 3.63% decrease on August’s record-breaking £166.5 million. It is, however, an incredible 45.56% year-on-year increase.
    • The projected annual total has risen again and is now tracking to finish at £1.77 billion in 2022 – another post-financial crisis record.
    • September saw a small drop in higher LTV lending (0.36%), a slight increase in average term (0.38%) whilst the average completion time increased to 1.94 days.
    • Like everyone in financial services, the last couple of weeks have been ‘interesting’. The second charge industry has seen a widespread increase in headline rates from almost all lenders, with rates typically increasing by an average of 1.75%. In addition, Together, West One and Selina have taken the step to temporarily withdraw fixed-rate products.
    • However, most second charge lenders – including Pepper Money, Oplo and Equifinance – have honoured existing applications where an ESIS has been produced.
    • Other than rate, there have been minimal criteria changes recorded and lending seems to be continuing at the same level (so far).
Key metrics from report:

Volume lent

£160.4m

£6.1m decrease on August 2022

Completions

3,002

11% decrease on August 2022

Types of loans

Asset

Consolidation

Consolidation and home improvements

Home improvements

Other

2.88%

40.68%

32.97%

 

19.5%

3.90%

Average completion time (from submission to completion)

20.56 days

1.94 days slower on August 2022

Average term

16.50 years

 

LTV split*

Below 85%

Above 85%

86.99%

13.01%

* One of the biggest impacts on mortgage lending during the pandemic has been on the level of equity available to borrowers. Second charge lending continues to offer an alternative method of raising capital for many, as such we will have highlighted the split of lending over 85% LTV.

Loans Warehouse panel

The Secured Loan Index is a monthly infographic brought to you by Secured Loan Broker and Loans Warehouse and takes information from the biggest second charge lenders in the UK including: Pepper Money; Oplo; United Trust Bank; Together; Norton Home Loans; Equifinance; Evolution Money; and Selina Finance, along with our own market knowledge to produce an accurate reflection of lending.

It is designed and produced to monitor activity in second charge lending in the UK.

To become a contributor and join the panel, please contact Matt Tristram.

 

Kindly shared by The Loans Warehouse

Main photo courtesy of Pixabay