The second charge mortgage market reported a fall in business volumes in October with lending figures down by 13%.

The market failed to sustain the strong performance recorded last year, according to  data from the Finance & Leasing Association (FLA).

Commenting on the latest figures, FLA’s director of consumer & mortgage finance Fiona Hoyle said: “Recent trends in the second charge mortgage market reflect a strong performance last year that has not been sustained during 2023 and the subdued economic outlook. The distribution by purpose of loan in October showed that 61% of new agreements were for the consolidation of existing loans, 12% for home improvements, and a further 23% for both loan consolidation and home improvements.”

In June, the second charge mortgage lending returned to growth, the first time that new business has increased by both value and volume since January.

However, the FLA said quarterly lending in that same month fell 9% by volume and 10% by value compared to the same quarter in 2022.

Over the past 12 months, lending increased by 10% on the previous 12.