Searches for second charge mortgages increased by 14% year-on-year in 2023, according to the research from Pepper Money and Knowledge Bank.
Knowledge Bank has partnered with Pepper Money to provide analysis of broker activity on the criteria search platform alongside the customer insights that were recently revealed in the specialist lender’s landmark research study.
The 2023 Pepper Money Specialist Lending Study found that 15.16m people in the UK have a history of adverse credit – missed credit payments, defaults, CCJs, unsecured arrears, secured arrears or have entered a Debt Management Plan. While Knowledge Bank said, there had been a modest increase in the searches for adverse in 2023 compared to 2022.
According to Knowledge Bank, the top five residential search terms were missed or late payments, defaults registered in the last three years, defaults registered more than three years ago, capital raising for debt consolidation and defaults over £500.
For second charges, Knowledge Bank says as well as the year-on-year increase, it also received a wider range of questions asked by brokers, with an increase of 77 more individual criteria searches from brokers.
The top search terms for second charges were capital raising for debt consolidation, debt management plans, defaults over £300 or registered in the last three years, and credit repair for adverse credit.
Knowledge Bank founder and chief executive Nicola Firth commented: “It was interesting to see that the top causes of adverse credit in the Pepper Specialist Lending Study mirrored exactly what we’ve seen brokers searching for on Knowledge Bank when trying to help their clients. ‘missed or late payments’ dominated searches”.
She added: “Second Charge mortgages have been a talking point throughout the year. They provide a means for clients to reset their finances and get back in control. It is a route which requires specialist training to complete, but one which offers a more holistic approach to the advice journey for clients. You can see from the top five searches why second charges are such a hot topic, and the advice around these is key.”
