Second charge loans
A second charge loan or second charge mortgage is a loan secured on your property from a source other than your original lender. Many people use them as a way to raise money for home improvements, or for debt consolidation. Second charge loans are also an option for people who cannot get unsecured loans, for example people who are self-employed, or who have a high early repayment charge on an existing mortgage.
A second charge loan allows you to use this equity as security against another loan, which means you’ll have two loans (mortgages) on your property.
As with any loan or mortgage secured on your property, Your property may be repossessed if you do not keep up repayments on your mortgage.
“Think carefully before securing other debts against your property; your property may be repossessed if you do not keep up repayments on your mortgage”
Second charge loans
A second charge loan or second charge mortgage is a loan secured on your property from a source other than your original lender. Many people use them as a way to raise money for home improvements, or for debt consolidation. Second charge loans are also an option for people who cannot get unsecured loans, for example people who are self-employed, or who have a high early repayment charge on an existing mortgage.
A second charge loan allows you to use this equity as security against another loan, which means you’ll have two loans (mortgages) on your property.
As with any loan or mortgage secured on your property, Your property may be repossessed if you do not keep up repayments on your mortgage.
“Think carefully before securing other debts against your property; your property may be repossessed if you do not keep up repayments on your mortgage”
How much can you borrow with a second charge mortgage?
This depends on the amount of equity you have in your home. Equity is the percentage of the property you own outright, which is the value of your home, minus any mortgages owned on it.
A lender will generally allow you to borrow up to 75% of the equity, but amounts will vary between lenders. In order to secure a second loan you’ll need to pass affordability checks to ensure you can afford the future mortgage repayments.
The pros and cons of second charge loans
Second charge mortgages can be useful. however taking one out is a big step and the interest rates can be significantly higher than for first mortgages. It’s essential to weigh up the pros and cons and to consult with a qualified financial advisor. Kingsmarque can help you assess your options before taking out a second mortgage. There may be alternatives, for example you could get a further advance on your current mortgage.
If a second loan looks like the best option for you we’ll help you find the loan best suited for your needs and financial situation. We’ll research the market and compare each lender’s APRC (annual percentage rate of charge), the length of the loan, and the total amount you’ll have to pay back. We’ll also help you assess the terms in detail, the fees and any early repayment charges, rates, and interest.
The pros and cons of second charge loans
Second charge mortgages can be useful. however taking one out is a big step and the interest rates can be significantly higher than for first mortgages. It’s essential to weigh up the pros and cons and to consult with a qualified financial advisor. Kingsmarque can help you assess your options before taking out a second mortgage. There may be alternatives, for example you could get a further advance on your current mortgage.
If a second loan looks like the best option for you we’ll help you find the loan best suited for your needs and financial situation. We’ll research the market and compare each lender’s APRC (annual percentage rate of charge), the length of the loan, and the total amount you’ll have to pay back. We’ll also help you assess the terms in detail, the fees and any early repayment charges, rates, and interest.
A second mortgage works like a first mortgage
Your home is at risk if you don’t keep up with repayments. If you get into arrears the additional interest can really add up.
If you sell your home, or it is repossessed, the first mortgage gets cleared first in full before any money goes towards paying off the second charge mortgage and the second loan lender can pursue you for any monies owed.
Asad was very knowledgeable and explained how he could help with the various aspects of my finances.
He was polite and friendly throughout. Thank you!
The financial adviser Asad Khan made contact with me very quickly.
He was able to answer questions I asked regarding my pension and advised me what I should do next.
Asad was super helpful and intuitive. He provided lots of options and tailored solutions, which was exactly what we wanted.