A toast to good health

The health of the secured loan market has come a long way in recent years, bringing good news for consumers and the industry alike.

Amy Loddington
27th February 2013
Matt Tristram - LW
The changes we have witnessed over the last few weeks have greatly influenced the strength of the secured loan market. Loan-to-values are high, repossessions are low and lending figures remain consistent; all of which are factors that provide sufficient evidence to the health of the second charge market.

The latest Secured Loan Index revealed that secured loan lending set a post-credit crunch January record, with £30.1 million lent to homeowners in the first month of 2013. Lending activity has been growing strongly on a year-on-year basis for over 15 months now, and in January gross secured loan lending increased again by 20.9%. This is a solid indication of market momentum and highlights the current mentality of the industry’s lenders- they are committed to ensuring the health of the secured loan industry is nothing but strong.

Another indication came from figures released by the Finance and Leasing Association last week, which revealed that second-charge providers repossessed 628 properties in 2012, down by 24.1% compared with 2011. These figures have provided lenders with that extra confidence boost and encouraged them to open the market even wider. This in turn has sparked some serious product innovation and has been the main influence behind recent product decisions- the announcements of higher LTV products now on offer in the secured loan market is all down to this increase in market confidence.

This opening up of the market has also ignited some healthy competition among the other lenders. Competition is incredibly healthy for the industry as it not only validates the market but can also help towards improving standards. Better competition can offer more choice and deliver better products at a better value and especially with more players entering the industry over the next few months, we will also see increased lending available.

Overall, there are clear signs that lenders are fulfilling their duties towards customers, which is an excellent indicator of how the health of the secured loan industry will trend in the months ahead.
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