Why a second charge loan?

Second charge lending has many uses and one of the advantages of this type of loan lies in its flexibility.

It may be the case that those who need to raise funds are not aware they can do so through a second charge which is, of course, where advisers and brokers come in.

This type of lending can be suitable for a far wider range of situations than many realise.

A second charge mortgage provides an extremely useful alternative where consumers want to raise additional funds but do not want to change their existing first charge mortgage.

For example, it could be used to fund home improvements, for loan consolidation and paying for a deposit and removal costs for a son or daughter moving into their first home.

Helping the kids

Parents are increasingly helping their children onto the property ladder by lending them money for their first home. Young people find themselves stuck in a cycle of renting and being unable to build up enough cash for a deposit on their first home.

According to recent research, parents or the Bank of Mum and Dad, will be involved in nearly 30% of property transactions taking place in the UK market this year.

The findings show parents will lend more than £6bn in 2018, providing deposits for over 250,000 mortgages, and helping family members to purchase homes worth £70bn.

If you wanted to use a second charge loan the list below are typical reasons why.

  • Locked into a fixed rate mortgage
  • Have an interest only mortgage – and want to keep it.
  • Have a lifetime tracker mortgage at an advantageous rate.
  • Need the money quickly and a re-mortgage will take too long.
  • Withdrawals from the ‘Bank of Mum and Dad’, to help children through university or onto the property ladder.
  • Need to release equity from a buy-to-let and don’t satisfy high street rental calculations.

Can we help?

If you would like to know more, please make contact and one of our fully qualified advisers will be pleased to guide you.