What is it?

A second charge mortgage (also known as a second mortgage or a secured loan) is a loan secured on your home (or investment property). They are called second charges because they have secondary priority behind your first mortgage (first charge) when it comes to repaying the loan. Often used as an alternative to remortgaging, they are a great way to raise funds for a wide range of purposes.

Why choose it?

• Change in credit rating – A drop in credit rating could mean you would have to pay more interest on your whole mortgage (as opposed to just the additional borrowing) if you were to remortgage. By taking out a second mortgage for the extra borrowing and leaving your first mortgage untouched, you could save a great deal
• Early repayment charge – If your current mortgage is subject to a high ERC, you could save money by taking out a second charge instead of remortgaging
• Self Employed – Second charges can be a great option for clients who are self employed and therefore struggling to obtain mainstream unsecured borrowing i.e. a personal bank loan
• Time – Second charges can often take a lot less time to complete than a standard remortgage and there are usually no upfront fees to pay

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