Second charge lending was down 8.79% in February compared to January, with a year-on-year decrease of 45%.
Data reported to Loans Warehouse from second charge lenders shows £95.3m was loaned in February – the first time this monthly figure has dropped below £100m since August 2021.
There was a monthly dip in higher loan-to-value lending compared to January too, with 3.59% fewer loans written above 85% LTV.
Completions were also down with a total of 2,374, compared to January’s 2,672 – an 11% decrease. The average loan term was 16.3 years, with a majority (88.7%) of the loans at an LTV of less than 85%
Service levels improved through, with average completion times, from pack received to funding, now down to 14.9 days.
According to the Secured Loan Index, the decrease in volume is being addressed by lenders in the sector, with Spring, West One, Selina Finance and UTB all applying rate reductions in the last month.
Loans Warehouse managing director Matt Tristram says: “Predictions for March are a significant increase in lending as funding becomes more secure.”
The index draws its data from a range of lenders including Pepper Money, Oplo, United Trust Bank, Together, Norton Homes Loans, Equifinance, Evolution Money and Selina Finance.
Last week, Evolution Money reported that homeowners are increasingly using secured home loans to consolidate more expensive debts.
