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Second Charges

A Second Charge mortgage is a secured loan for homeowners with a second lender that will use the equity in your property as surety; this is dependent on the difference between the value of property and the balance outstanding on your first mortgage and you will end up with two mortgages.

However, Second Charge mortgage is totally separate to the first mortgage and allows you to borrow money without having to go through the costly process of remortgaging but will require the permission from your current lender and rate are usually much higher.

There is a lot of flexibility in how funds raised from a Second Charge mortgage can be used – from home improvements, debt consolidation to helping family members with a deposit for their own home.

Regardless to what the fund is used for, a Second Charge is ideal if you are tied in with a hefty penalty (early repayment charge) on your first mortgage, should you decide to move to another lender or if you are already on a good deal and moving to another lender means you will end up paying a lot more for the whole amount.

At Advance Mortgages we can cost-compare between other options such as getting Further Advance (additional borrowing) with the same lender or remortgaging the full loan to another lender and tell you whether Second Charge will be best option for you. If second charge is the ideal route for your needs, we will then refer you to our business partners who deal with second charges to assist you.

Talk to us. We are delighted to direct you…

With Second Charges, Did you know?…

Advantage Disadvantage
You can keep the existing rate on your first mortgage You’ll pay a higher interest rate than your first mortgage
No need to pay penalties/ ERC to remortgage now You must pay off both mortgages in full if/when you move
No need to extend the term of your current deal You could lose your home if you fall behind on the monthly payments
Easy to access than an unsecured personal loan

Alternatives:

  • Further Advance (Additional loan) with the current lender
  • Remortgaging for a larger loan
  • Accessing your savings
  • Application for personal loan