FLA data show strongest year for second charge activity since 2008
New business in the second charge mortgage market rose sharply in 2025, with both the value and volume of lending reaching their highest levels since before the 2008 financial crisis.
According to the latest figures from the Finance & Leasing Association (FLA), new second charge mortgage advances totalled £2.14 billion in the 12 months to December 2025, an increase of 24% on the previous year. Over the same period, the number of new agreements climbed 17% to 41,760.
Activity was particularly strong in the final quarter. In the three months to December 2025, second charge lending reached £608 million, up 33% year on year, across 11,551 new agreements, a rise of 27%. December alone saw £182 million of new lending, 41% higher than in December 2024, with 3,379 new loans completed, a 35% uplift.
Commenting on the figures, Fiona Hoyle (pictured top), director of consumer and mortgage finance and inclusion at the FLA, highlighted the market’s momentum at the end of the year. “The second charge mortgage market ended 2025 on a strong note with new business volumes up 35% in December compared with the same month in 2024,” she noted. “In 2025 as a whole, new business by both value and volume reached its highest level since 2008.
“The analysis of loan purpose suggests a stable picture with the proportion of new business volumes which were solely for the consolidation of existing loans last year at 58.3%. A further 23% were for home improvements and loan consolidation, and 12.0% solely for home improvements.”
Following publication of the FLA statistics, surveying firm Pure Panel Management reported that it had also seen higher volumes flowing through lender and broker partners during 2025.
“We have seen strong growth in second charge surveying demand through our second charge lender and broker partners in 2025,” said James Gillam (pictured right), managing director at Pure Panel Management.
“It is not just existing lenders doing more. New entrants have moved quickly to win share after launch, and they have also helped increase total market size, not merely swap business between firms.”
For brokers active in the segment, the combination of rising volumes, a stable mix of loan purposes and new lender entrants points to a market that is expanding rather than simply rotating business between providers. The figures may encourage more intermediaries to review their second charge panels, referral relationships and advice processes to ensure they can respond to ongoing demand from clients seeking capital while preserving existing first charge deals.
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