Overall secured loan lending in 2012 currently stands at £327.1m – the highest level since 2009, where overall it stood at £566m.
Second charge lending advanced to £34.3m during November. This was a 7.5% increase on the £31.9m lent in October and a 22.5% increase from £28m in November 2011.
November is the 5th consecutive month where lending has been over the £30m mark, evidence of how the secured loan industry has stablised since the credit crisis.
Matt Tristram, joint managing director of Loans Warehouse, said: “Shawbrook announcing its new strategy to attract more sophisticated individuals to the market unsurprisingly had an impact on November’s figures.
“We’ve definitely seen an increase in enquiries from high net worth borrowers over the past few months and in attracting these individuals provides evidence the secured loan sector is definitely maturing.
“Not only that but the lending levels the Index has highlighted so far clearly demonstrates how much the second charge market has stablised.
“We have had uninterrupted levels of over £30m for five straight months now and demand for secured loans has remained relatively consistent. The key to recovery is a stable market and compared to the irregular 2011, I think it’s reasonable to say that the market is in excellent health.
“Over these last few months, awareness of secured loans has increased substantially- especially among brokers. This was a key challenge when we first launched the Index and so it is encouraging that more mortgage networks are ensuring they’ve a secured loan offering through a master broker.
“Secured loan awareness has certainly grown but it is clear that there is still a lot more to do. Raising general awareness among brokers is all well and good but brokers need to fully understand the benefits of secured loans first so that they can deliver well-informed advice to their clients.
“All in all, this year has been a great year for the secured loan industry but I believe 2013 will be the year. Improved confidence in alternative lending and continued innovation from the lenders should be a huge impetus on the market in the coming months and drive the second charge lending market further forward in 2013.”
Luke O’Sullivan, new business manager at Equifinance, said: “2012 has definitely seen a resurgent second charge lending market,buoyed by new entrants early in the year providing niche products that add to those already available from the existing lender and enabling intermediaries to help more customers than in previous years.
“Equifinance has lent in excess of £1.5 million this year, and plans to quadruple this in 2013. With multi million pound funding secured via a mix of private investors and the successful launch and first close of the Equifinance Loan Fund we are looking forward to supporting even more intermediaries next year.
Maeve Ward, head of sales, secured lending, Shawbrook Bank, added: “Shawbrook Bank have been very successful in 2012 and have very ambitious growth plans for 2013. Our key partners are at the heart of everything we do and we will continue to work closelywith them to develop new, innovative products, systems and processes to strengthen our position in the market and assist with what has been continual growth in 2012.
“The New Year will see more secured loan providers entering the market, which will spark healthy competition and in turn provide consumers with a wider choice of products. The secured loan market is an exciting space to be in right now and the future is bright.”
Stuart Aitken, chief operating officer at Masthaven Secured Loans, said: “We could not possibly be happier with the response since we entered the market. In a sector that is looking forward to an increasingly positive future, specialist secured brokers have been universally supportive of our initial product and service. Volumes are steadily increasing and, having already passed our first £1m of total lending, I expect us to hit our first million pound month early in the New Year.
“Whilst the implementation of changes brought about by the new regulatory regime that is just around the corner will be challenging, even for those of us who are already FSA authorised, there are many potential positives in the harmonisation of secured lending with first mortgages as a result of the MMR. The secured lending community is already demonstrating that a range of second second mortgage options is vital to the consumer, and I look forward with keen anticipation to 2013.”
And Paul Stringer, director, Norton Finance, added: “Many of our lending partners have been discussing the positive changes to criteria they intend to make in the New Year; these changes are likely to be both an improvement in interest rate for some lenders and an expanding of criteria for others. This has been combined with more upbeat conversations around the interest funders may have in the second charge industry next year.”