A new report has revealed that last year saw a significant rise in the number of searches that advisors conducted for second charge loans, in comparison to the year before.
This report was produced by Knowledge Bank in collaboration with the specialist mortgage lender Pepper Money. It shows an annual rise of 14% in the number of second charge mortgage searches during 2023. The Pepper Money and Knowledge Bank report examined the searches made by advisors using the criteria searching platform and also looked at the feedback from consumers contained in a research study published by Pepper Money last year.
Called the Pepper Money Specialist Lending Study, it showed that the number of UK residents with credit issues either in the present or the past is 15.16 million. Among those issues are County Court Judgements, secured or unsecured arrears and mortgage defaults. The new research with Knowledge Bank indicates that adverse credit searches by advisors also went up in number last year.
When it comes to the reasons why advisors were looking for second charge loans, the primary ones were credit repair and either the management or consolidation of debt. Founder of Knowledge Bank Nicola Firth observed to Mortgage Strategy that:
“Second charge mortgages have been a talking point throughout the year. They provide a means for clients to reset their finances and get back in control.”
Advisors who have CeMAP training will know that this is an option for clients who own property and who are struggling with rising living costs.