Ongoing financial crunch has made adverse effects on second mortgage business. As the result many of the second mortgage lenders are disappearing from the UK loan market. As house prices fell drastically, the equity value of the homes also declined immensely causing the non availability of second mortgage loans.

Over a dozen of the second mortgage lenders have disappeared from the scene due to the financial recession in the past one year. Repossession is also getting ineffective as there is virtually no money left once the first mortgage and legal fees are repaid.


Second mortgage loans were one of the most popular financial products in the loan market as they were ideal sources of money for debt consolidation and for meeting other necessary requirements at affordable interest rates.

According to the lenders, steps taken by the government to assist the lenders is not sufficient enough to rebuild the money lending market. There is a huge scarcity of money and huge capital would be required to balance the current losses. They can not do anything on their own to survive.