A second charge mortgage, also known as a secured loan or second mortgage, allows you to borrow money against a property that already has an existing mortgage (known as a first charge). This new loan is entirely separate from your first mortgage, often with a different lender, interest rate, and repayment terms.
Before taking out a second charge mortgage, you typically need permission from your current mortgage provider.
Since the second charge lender takes on more risk, interest rates are usually higher than those on a first mortgage. If you fail to make payments and your property is repossessed, the first mortgage lender gets paid first. If there isn’t enough equity left to cover both loans, the second lender could lose out—hence the increased rates.
Book an appointment with our team to talk through your mortgage needs and get personalized advice at a time that works for you.
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