Second Charge Mortgages
Innovative second charge mortgages that we’re proud of
When it comes to Second Charge mortgages, you want to borrow more money, but knowing how best to do that, is confusing.
Which is why we always consider all your options, and work out the best thing for you.
Do you have a question about a second charge mortgage?
What is a second charge mortgage?
A second charge mortgage is just a loan, in exactly the same was as a mortgage is a loan. Both are secured on the property. Which means if you can’t make the payment, the lender can eventually take possession of the property.
The difference is that the second charge, does not preceed the first one. In other words the first lender, has what is known as the first legal charge on the property, then any other lender that comes after will have the subsequent charge in that order.
This is important becuase in the evet of a default or repossession, the debt is always recouped by the highearchy of the lender. So the first charge lender has priority to revover all of its debt, then if anything remains, the second charge lender is then able to recoup its debt and so on and so forth. The second charge lender always has a higher risk of not recovering their debt. Which is why the cost of a second charge tends to be higher, to reflect the extra risk they are taking.
Is a second charge mortgage, just for a residential home?
No not at all. In fact you can get a second charge mortgage for virtualy anytype of property or deal. For example a developer who finds they are running out of funds, and their existing lender does not agree to increase their borrowing facility, could find a second charge lender is a real lifesave r for a deal. Or a landlord who can’t raise more money on their existing property investment assets by remortgaging, maybe able to do so with a second charge lender.
There are lots of scenarios, other than a residential home, that a second charge can help.
When would I consider using a second charge mortgage?
Second charge mortgages are just a way to borrow extra money. It is usually cheaper than a personal loan, becuase it is secured against a property giving the lender more peice of mind that they will be able to revover the debt, in the event of a default.
A second charge mortgage should always be considered if and when you are looking to borrow more money on your mortgage. However this should not be done in isolation and considering all options is vital.
If you are looking to increase a mortgage to borrow extra money, then three options should be considered:
1. Remortgage to another lender and borrowing the entire amount.
2. Stay with your existing lender and borrow some extra with them.
3. Keep your mortgage as it is, but get a second charge for the extra borrowing.
Working out the best option can be a complex process, which is why it is always advisable to get professional advce and help from an independent mortgage broker.
Our experts are here to help you, every step of the way
Our expert knowledge has been built from experiences in the independent, corporate and property world. From complex property portfolios to first time buyers. If there’s a way to do it, we’ll find it.
- We assess
- You instruct us
- We research
- We find the best deal for you
Agreement In Principle
- You agree to the deal
- We submit the first stage of your application
- You get an agreement in principle
- We submit the second stage of your application
- We present your application in the best possible manner
- They assess your situation
- We support you throughout the process
- They assess your property
- You receive your mortgage offer
- Technically our job is done but we also like to help
- We liaise with solicitors and estate agents
- We keep you updated
- You achieve your goals