With lenders offering lower rates and the majority of brokers charging lower fees, today’s second charge borrower has access to a very real alternative to a re-mortgage or further advance.
Figures recently released by the Finance & Leasing Association reveal that second charge mortgage business increased in May by 14.4% in value and 18% in volume, compared with the same period last year. What is more, consumers including landlords are beginning to gain awareness of the second charge option and to understand how it can assist them.
All of that said, a gap in understanding remains, with a recent survey showing that many consumers remained either unaware or cautious of the sector.
Who can benefit taking out a second charge?
Second charge mortgages are not necessarily the best option for every client wishing to capital raise. Typically, they prove useful for clients who are:
- Tied into a fixed mortgage with restrictive early repayment charges.
- Benefiting from an existing low mortgage rate
- Being offered a further advance with a higher rate
- Currently on an interest-only mortgage product
- Wishing to capital raise for business purposes, including deposits for buy-to-let mortgages.
- Recently self-employed or contract workers
Like to know more?
If you would like to discuss your borrowing options please do make contact and one of our fully qualified independent advisers will be happy to assist.