Second Charge Mortgages
A second charge mortgage (often called a secured loan) is a loan taken out against a property you already own, sitting behind your existing first mortgage.
You keep your current mortgage in place, and the second charge is secured on the remaining equity.
It means you can borrow additional funds without replacing your current mortgage deal, which is especially helpful if:
You’re tied into a low rate
You’d face high early repayment charges (ERCs)
Your current lender won’t offer additional borrowing
Your circumstances don’t fit a standard remortgage
You only need a specific amount for a defined purpose
A second charge gives you flexibility while keeping your main mortgage untouched.
How can a second charge loan help me?
With a second charge, the first mortgage lender remains the primary charge holder, and the second charge lender is repaid only after the first in the event of a sale or repossession. Because of this priority order, the first lender must give consent and the second lender will carry out its own affordability assessment. The product runs alongside your current mortgage with separate repayments and usually has a slightly higher interest rate than a standard residential mortgage.
Clients typically use second charges when they need to raise capital for home improvements, debt consolidation, large one-off expenses, business purposes, or situations where remortgaging would be financially disadvantageous. It is often chosen when replacing the first mortgage would mean losing a favourable interest rate or paying high early repayment charges. It is also a useful option if your circumstances have changed since taking out your original mortgage and your current lender is no longer able to help.
Second charge lenders assess applications in a similar way to residential lenders. They look closely at income, existing financial commitments, credit history, and the level of equity in the property. Affordability must be clear and sustainable, and the property itself has to meet the lender’s criteria regarding construction, condition, and overall suitability as security.
Choosing between a remortgage and a second charge depends on the client’s goals, costs, and overall financial position. A second charge can preserve a low-rate mortgage, avoid significant penalties, provide faster access to funds, or accommodate more complex circumstances that a mainstream lender may decline.
At Connect, the process is handled with the same level of care as any other regulated mortgage. Advisers review both routes, compare costs, check lender criteria, and guide clients through every stage from consent to completion. This ensures that the final recommendation is suitable, affordable, and aligned with the client’s long-term plans.
What next?
If you are looking for a mortgage solution that suits your needs and budget, we are here to help. Please visit our contact us page and fill out a simple form with your details and query.
We will get back to you as soon as possible with the best options for you. Thank you for choosing us as your mortgage partner.