Pepper Money recorded its strongest ever month for second charge mortgages in March, as the wider market reached levels not seen since before the financial crisis.

Pepper Money funded £57m of second charge lending in March, marking the highest monthly total in its history and underlining continued momentum in the sector.

The milestone comes amid sustained growth across the UK second charge market, with figures from the Finance & Leasing Association showing total lending reached £228m in March 2026. This represents a 36% increase year-on-year and the highest monthly figure since February 2008.

Across the first quarter of the year, new business totalled £625m, up 33% on the same period in 2025, highlighting the scale of demand returning to the sector.

Pepper Money said its performance reflects a continued focus on supporting brokers and borrowers through faster decision-making, competitive pricing and clear criteria, at a time when affordability pressures remain acute.

Ryan McGrath, sales director of second charge mortgages at Pepper Money, said: “This marks the highest monthly lending we’ve achieved to date, reflecting our commitment to a broad and accessible product range, as well as clear, transparent communication that supports both brokers and customers.”

“Against a backdrop of continued market growth, cost-of-living pressures show little sign of easing, while ongoing geopolitical uncertainty is likely to drive further increases in everyday expenses such as energy and fuel.

“At the same time, a housing market characterised by slower transactions and less attractive interest rates is discouraging many homeowners from moving, increasing the trend to improve rather than move.”

The lender pointed to a growing preference among homeowners to raise capital through second charge borrowing rather than refinance their primary mortgage, particularly where existing rates remain more favourable than current market pricing.

“Second charge mortgages are becoming increasingly mainstream as a flexible and reliable way for homeowners to access equity without disturbing their existing mortgage.

“With economic volatility persisting, these products offer a practical route to secure funding with greater certainty. We continue to see strong demand from both brokers and customers and remain committed to supporting homeowners as the market evolves.”