The Intermediary – March 2025 - Flipbook - Page 62
S E C O N D C H A RG E
Opinion
Opportunity
hat do second
charge
mortgages and
underwriting
mortgages
for customers
with second jobs have in common?
Other than both including the word
‘second’, they also both represent
growing opportunities for brokers to
support their customers.
With rising living costs and shiing
financial priorities, more borrowers
are either supplementing their income
with additional employment or
seeking flexible borrowing solutions
to manage their expenses.
This is supported by customer
research from the latest Pepper Money
Specialist Lending Study, alongside
broker search data from One Mortgage
System (OMS).
W
Second jobs
Findings from the 2024 Pepper Money
‘Specialist Lending Study’ reveal that
7.34 million people in the UK are now
earning income from more than one
job – a notable increase from 5.77
million in the previous study.
The cost-of-living crisis is a key
driver behind this trend, as more
individuals seek additional sources of
income to manage expenses.
The study highlights that this shi
is particularly prominent among
younger adults, with a quarter of 18
to 24-year-olds and nearly the same
percentage of 25 to 34-year-olds
supplementing their primary income
through secondary employment.
Meanwhile, the trend is also growing
among older demographics, showing
that financial pressures are affecting
people across all age groups.
This rise in multiple income sources
aligns with data from OMS, which
shows an increasing number of
mortgage applications citing second
jobs. In 2023, 11.81% of applications
included a second job, a figure that
rose to 12.34% in 2024.
The increase has been particularly
pronounced in the laer part of 2024,
RYAN BRAILSFORD
is business development
director at Pepper Money
with notable month-over-month
spikes, including a 64% rise in
September and a 55% increase
in October.
Second charge mortgages
Alongside the trend of multiple jobs,
demand for second charge mortgages
is also growing. According to OMS,
completions of second charge
mortgage products increased by
33% from 2023 to 2024, making up
10.65% of total completions last year,
compared to 9.17% the previous year.
The latest findings from the Pepper
Money ‘Specialist Lending Study’ have
provided insights on the reasons why
customers choose to take a second
charge mortgage.
Home improvements and debt
consolidation remain the most
common reasons, accounting for
more than half and nearly a third of
second charge mortgages, respectively,
but other motivations are emerging.
For example, 13% of respondents say
they would consider a second charge
to cover education costs, with this
figure rising to 23% in London.
Additionally, a growing number
of people say they would use a second
charge mortgage to help family
members with deposits, invest in
additional properties, or even fund
business ventures.
As customer circumstances become
more diverse, brokers must ensure
they’re working with lenders that can
