The Intermediary – May 2025 - Flipbook - Page 21
S E C O N D C H A RG E
In focus
DEMOGRAPHICS
INNOVATIONS
Favourable economic conditions,
including stable employment and
improving tech-enabled access
to credit.
Keeping pace
To remain competitive – and relevant
– lenders are responding with
meaningful product innovations
that reflect the changing face of their
customer base.
1. Digitally-driven
application journeys
Modern borrowers expect speed
and convenience. Digital portals
and automated decisioning are now
standard among many lenders,
streamlining the process and
improving both the broker and
borrower experience.
2. Flexible loan structures
From variable terms to overpayment
allowances, lenders are increasingly
offering flexible repayment solutions
that cater for the needs of borrowers
with fluctuating incomes or nontraditional financial backgrounds.
3. Smarter underwriting and
pricing models
Many lenders are looking beyond
standard credit scoring, adopting
more holistic approaches that consider
individual borrower circumstances –
helping those with complex income
streams or thin credit files access
appropriate funding.
4. Green financing options
As eco-consciousness grows,
several lenders have launched
products that incentivise green
home improvements. Lower
interest rates for energy-efficient
upgrades are appealing to
younger, environmentally aware
homeowners and align with
broader environmental, social and
corporate governance (ESG) goals
across the industry.
Final thoughts
The second charge mortgage market
is in the midst of a transformation.
No longer confined to older,
equity-rich borrowers, it’s rapidly
opening up to younger, more diverse
homeowners with a broader range of
financial goals.
As lenders continue to innovate
and respond to evolving borrower
needs, the future for second charges
looks bright.
For brokers, this presents
a significant opportunity.
Understanding the nuances of this
The second charge
mortgage market is [...]
rapidly opening up to
younger, more diverse
homeowners”
shiing demographic – and staying
informed about the latest product
developments – will be key to
supporting clients effectively and
unlocking the full potential of the
second charge market. ●
May 2025 | The Intermediary
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