The Intermediary – February 2026 - Flipbook - Page 64
S E C O N D C H A RG E
Opinion
The quiet shift
in second charge
lending
F
or much of its history,
second charge lending
has been defined by
product rates, criteria,
loan-to-values (LTVs) and
speed. Access to capital
was the story, and innovation focused
on expanding who could borrow, how
quickly decisions could be made, and
how flexibly equity could be unlocked.
But as we look forward in 2026,
something quieter, and arguably
more significant, is happening in
the background. The competitive
advantage in second charge lending is
no longer access. It is perspective.
In today’s market, borrowers are
not short of options. Product ranges
are broad, technology has streamlined
processes, and advisers can source
faster than ever.
What you could argue is becoming
harder is understanding which option
genuinely delivers the best outcome
for a customer when navigating
increasingly complex financial lives.
This is where the real shi lies.
Complexity, not scarcity
Second charge lending now sits at an
intersection of multiple pressures:
first charge fixes that borrowers
are reluctant to disturb due to an
uncertain market, rising living costs,
and an ageing homeowner population
siing on high equity. Yet consumer
credit figures are rising, and this
short-term available credit, together
with high living costs, is creating
a storm.
These are not simple borrowing
decisions. Customers are weighing
trade-offs between short-term
affordability and long-term costs,
between certainty and flexibility,
and between immediate need and
future resilience. In this context,
the value of second charge lending is
62
The Intermediary | February 2026
JONNY JONES
is CEO at Interbridge Mortgages
not simply that it exists, but that it is
properly understood.
Objectivity maers because second
charge is rarely the obvious answer. It
is the considered one.
But it is a sector that is growing;
based on historic Finance and Leasing
Association (FLA) numbers and our
own market insights, Q4 2025 saw
the market 35% up on the same time
last year and a massive 80% higher
than two years ago. We believe that
the growth is sustainable and likely to
be achieved.
Advice quality
As product and lender choice has
expanded, the role of advice has
become more central, not less. The
best outcomes increasingly depend
on advisers being able to step back,
assess the full picture, and explain
not just what a customer can do, but
why one route may be more suitable
than another.
That places a growing responsibility
on the entire market ecosystem –
lenders included.
Lenders are uniquely placed
to influence outcomes through
how they structure propositions
and how they work with advisers
to navigate more complex cases:
customers with vulnerabilities,
layered credit histories, or changing
circumstances that do not fit neatly
into automated models.
It means recognising that in a
mature, regulated market, the
strongest partnerships are built
around shared responsibility for
outcomes, not just approvals.
Outcome-led thinking
The regulatory framework in the
UK already points in this direction.
The Consumer Duty has sharpened
the industry’s focus on foreseeable
Perspective [...] and
prioritising long-term
outcomes is where the real
differentiation now sits”
harm and customer understanding.
But beyond regulation, there is
a commercial reality; lenders
who consistently support beer
outcomes will earn trust, loyalty
and sustainability.
Complaints and reputational
damage are oen the delayed
symptoms of poor understanding
earlier in the journey. Investing
in clarity, perspective and advice
led processes is not a cost, it is risk
management in the highest order.
Second charge lending, when done
well, can be transformative. When
done poorly it can be misunderstood.
The difference lies in how decisions
are framed, explained and supported.
From products to context
None of this diminishes the
importance of competitive products.
But as we progress through 2026, the
leaders in the second charge market
will be those who recognise that
products are only the starting point.
Perspective, understanding the
customer’s broader context, adviser
judgement, and prioritising longterm outcomes, is where the real
differentiation now sits. It is a quieter
shi than new product launches, or
technology announcements. But it
is one that, I believe, will define the
next chapter of second charge lending
in the UK. ●
