According to figures from the Finance & Leasing Association, the volume of new second-payment mortgage contracts fell by 1% in volume and 9% in value in May 2026.
£175m worth of new contracts were agreed in May, with 3,245 new deals signed in the month.
In the three months to May there was £594m of new second line activity, comprising 10,878 loans.
£2.35bn of new second-tier contracts were written in the year to May, up 13%, with 44,402 loans, up 19%.
Fiona Hoyle, director of consumer finance and mortgages and inclusivity at the Finance & Leasing Association, said: “In May, the second mortgage market reported a contraction in new business for the first time since April 2025. Despite this, the volume of new business grew by 17% in the first five months of 2026.”
“Demand is expected to remain resilient in the coming months as households look for flexible financing for home improvements, loan consolidation and other major expenses. Second-payment mortgages continue to provide a valuable option for consumers looking to effectively manage their finances.”