The Intermediary – December 2025 - Flipbook - Page 55
S E C O N D C H A RG E
Opinion
Demand rises amid
economic pressures
S
econd charge mortgages
are becoming an
increasingly crucial part
of the mortgage market,
with their role expanding
throughout 2025.
Over the course of this year, we’ve
seen consistent growth in this sector,
driven by rising awareness and
demand for these flexible financial
products.
At the same time, new lenders
entering the market have created
a more competitive environment,
which has only served to strengthen
the sector as a whole. So, let’s take a
moment to reflect on 2025.
Market growth
The data from the Finance & Leasing
Association (FLA) speaks volumes, as
both the value and volume of second
charge mortgages have seen growth
in most months throughout 2025.
This upward trajectory highlights
the increasing importance of second
charge mortgages for homeowners in
today’s market.
So, what’s driving this growth?
Debt consolidation and home
improvements have long been the
primary reasons for taking out
second charge mortgages, and
these motivations continue to
drive demand.
However, the current economic
climate is further fuelling this
demand, as more people struggle to
manage their debt and finances due to
high living costs. As a result, the need
for flexible borrowing options has
become even more pressing.
Second charge mortgages have
emerged as a key solution, as they
don’t disrupt the client’s existing
mortgage arrangements, and they
offer a lifeline if their further advance
has been declined.
Education is key
One of the key factors behind this
growth, I believe, is the industry’s
heightened focus on education.
Over the past year, there has been a
concerted effort to raise awareness
about second charge mortgages, both
among consumers and brokers.
The more brokers understand the
advantages and applications of second
charge products, the more confident
they become in talking about them
to clients.
At The Loans Engine, we’ve worked
closely with brokers to provide
STEVE NOBBS
director at The Loans Engine
training, case studies, and other
resources to help them spot
opportunities for second charges.
This education has been critical in
driving more awareness, and we’ve
seen demand rise as brokers feel more
equipped to have these conversations
with their clients.
This shi in broker confidence
is vital for the market’s continued
success. Brokers are in the best
position to guide clients through the
complexities of mortgage solutions,
but they can only do so effectively if
they have a good understanding of the
available products.
Continued investment in education
will be essential to ensure that second
charge mortgages are considered,
especially when clients are unable
to secure a further advance or do not
want to remortgage due to losing
a preferential rate or incurring
significant early repayment charges.
What’s next?
Improved and varied product choice is making second charge an increasingly appealing solution
As we turn our aention to 2026,
the second charge mortgage
market is poised for continued
growth. Innovation and heightened
competition will continue to drive
product enhancements, while further
education efforts will help build
even more awareness and confidence
within the broker community.
The demand for second charge
mortgages shows no signs of slowing.
With economic pressures continuing,
more consumers will likely turn to
these flexible solutions. However,
there’s still room for growth. To
ensure the market’s continued
progress, ongoing investment in
education will be essential. ●
December 2025 | The Intermediary
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