Second charge loans are surging ahead

It’s no secret that second charge lending is surging ahead as more homeowners look to secure cost-effective loans. Figures clearly show second charge lending is becoming a “household favourite” as opposed to expensive unsecured loans. Homeowner awareness has increased substantially over the last 3 years thanks to brokers taking on board the positives this sort of lending offers.

Second charges are widely used if:

  •  Currently on an interest-only mortgage product
  • Have been declined on a re-mortgage
  • Wishing to capital raise for business purposes
  • Recently self-employed or contract workers
  • Recently retired

Second charges also offer criteria advantages, such as higher loan-to-value borrowing, ERC-free or low-ERC loans, and lending to borrowers with complex income or multiple sources of income, or those with adverse credit.

The length of time it typically takes to arrange a mainstream first charge mortgage, re-mortgage or further advance can prove frustrating for those looking to raise capital quickly.

Many second charge lenders can arrange the required loan within 21 working days if everything is straightforward which is a considerable time-saving.

Rates and fees are also hitting impressive lows. Lenders in the sector continue to reduce interest rates, which currently start a little over 4%.

There are also several attractive exclusive, semi-exclusive and restricted panel products available through specialist packagers.

Although these do not challenge mainstream first charge mortgage rates, when considering the overall client scenario and costs, second charges loan are surging ahead and can provide a viable alternative.

Like to know more?

If you are looking to raise capital on your property please do make contact and one of our advisers will be happy to help.