There were 2,295 new second charge agreements made in January, says the Finance and Leasing Association (FLA).

This is 8% more than in January 2022, it adds.

Meanwhile, the value of new business stood at £103m, which is 14% more than the year previous.

The FLA also notes that new agreements made numbered 33,951 in the 12 months to January – a 27% annual increase – and the value of new business came to £1.57bn, a 37% rise on the year.

FLA director of research and chief economist Geraldine Kilkelly says: “The second charge mortgage market made a positive start to 2023, with growth in both the value and volume of new business.

“The distribution by purpose of loan in January showed 61% of new agreements were for the consolidation of existing loans, 14% for home improvements, and a further 20% for both loan consolidation and home improvements.”

And Freedom Finance chief growth officer Andrew Fisher comments: “Many of the economic tailwinds that drove substantial growth through last year remain strong, with rising rates making re-mortgaging an unattractive option for those on longer-term fixed-rate deals.

“Debt consolidation is another significant driver for the second charge market as people look to re-finance more expensive borrowing.”