The second charge lender takes a legal charge on your property ranking behind your first mortgage lender — in a sale or repossession, the first lender is repaid in full before the second sees anything. That subordinated position is riskier for the lender, which is why second charge rates sit above first charge rates, though well below unsecured borrowing.
Your first mortgage is unaffected: the payments, rate and term continue exactly as before. The second charge has its own term (commonly five to twenty-five years), its own rate, and its own monthly payment. Your first lender's consent is required for the second charge to be registered, and obtaining it is part of the process we manage.
If you have a low fixed-rate mortgage, a second charge loan can help you raise funds without losing your existing rate or paying costly early repayment charges.
Raise funds without replacing your current mortgage.
Keep your existing mortgage and avoid unnecessary ERCs.
We assess second charges, remortgages and further advances to find the best solution.
The second charge market includes lenders notably flexible on contractor, self-employed and complex income — day rates, retained profits, recent trading histories and variable earnings that first-charge lenders handle inconsistently. For a contractor whose circumstances have changed since their first mortgage was underwritten — a move inside IR35, a new company, a gap — the second charge route can release equity without inviting a fresh full-strength affordability review of the entire borrowing.
We apply the same day-rate-first assessment logic here as across all our contractor lending: the application goes to the lender whose income methodology values your earnings highest.
Second charge mortgages on your home are regulated by the FCA under the same mortgage conduct rules as first charges, with full advice and affordability requirements. Rates vary widely with loan-to-value, credit profile and income complexity; fees typically include lender arrangement, valuation and legal costs. We present the true total cost over the realistic term, not the headline rate.
Completion is usually faster than a remortgage — often two to four weeks — because the first mortgage is untouched and the legal work is narrower. For time-sensitive purposes such as a tax deadline or an investment completion, that speed is itself part of the value.
Second charges are rarely held to full term. The common exits: consolidation into a single remortgage when your first-charge fixed rate ends; repayment from a property sale; or repayment from a liquidity event the borrowing anticipated. We plan the likely exit at the outset and prefer products whose ERCs match it — a second charge intended to last three years should not carry five years of repayment penalties.
No — your first mortgage continues exactly as it is: same rate, same payments, same term. The second charge is a separate loan with its own terms, registered behind it. Your first lender must consent to the registration, which is a routine step we handle within the process.
It depends entirely on what you would give up. If a remortgage means surrendering a low fixed rate across your whole balance or paying early repayment charges, the second charge usually wins despite its higher rate, because the premium applies only to the new money. We run the side-by-side calculation on every case rather than assuming either answer.
Lenders work to a combined loan-to-value — first mortgage plus second charge — typically up to 85%, sometimes higher. On a £500,000 property with a £300,000 first mortgage, an 85% combined LTV supports a second charge of up to £125,000, subject to affordability on your income.
Yes — and the second charge market is often more flexible on contractor and complex income than first-charge lenders. Day rate assessment, recent trading histories and variable income are all placeable with the right second charge lender. We match the income methodology to your structure exactly as we do for first mortgages.
It cuts the monthly cost, but it converts unsecured debt into debt secured on your home and usually extends its life — both of which we will say plainly before recommending it. Done with discipline (and without rebuilding the unsecured balances), it can be a sound reset. Done casually, it relocates a problem onto your house. The advice depends on the full picture, and we give it honestly.
It is repaid from the sale proceeds after the first mortgage, like any secured loan. If you are selling soon, factor any early repayment charges into the decision — or choose a product without them, which is part of matching the product to your realistic exit timeline.