The UK’s second charge mortgage market surpassed £2.14 billion in new lending in 2025, the Finance & Leasing Association (FLA) reveals.

The latest data found that last year more than 41,700 new agreements were completed.

The figures represent year-on-year growth of 24%, representing another period of sustained double-digit expansion for the sector.

Meanwhile, the FLA found that average loan sizes across the market have increased for the third consecutive year, rising from £45,341 in 2023 to £51,198 in 2025.

Pepper Money director of second charge mortgages Ryan McGrath says: “The FLA’s latest data confirms the second charge sector’s rapid expansion, with over £2 billion in new lending and tens of thousands of new customers using these products.”

“The market has now delivered multiple consecutive years of double-digital growth, reflecting a structural shift in how homeowners access equity.”

“As inflation eases and base rates stabilise, demand for second charge mortgages as a mainstream solution will continue to grow throughout 2026. These products are no longer a niche offering; they’re an essential part of how UK homeowners manage equity and financial flexibility.”

Pure Panel Management managing director James Gillam adds: “At Pure Panel Management, we have seen strong growth over the same period in second charge surveying demand through our second charge lender and broker partners.”

“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.”