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What Are the Advantages of Taking Out a Second Charge Mortgage?

For homeowners with equity tied up in their properties, a second charge mortgage can be an affordable and versatile funding solution for a variety of purposes.

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second Charge Mortgage

As homeowners across the UK look to tap into the equity they have tied up in their homes, the popularity of second charge mortgage products is growing. One of several available options for raising capital for a wide variety of purposes, a second charge mortgage can be a flexible and affordable funding solution.

What Exactly is a Second Charge Mortgage?

secured loansAs the name suggests, a second charge mortgage is a secondary secured loan taken out against your home. Your primary mortgage remains unaffected, which you will continue to repay as normal. When you take out a second charge mortgage, you subsequently end up with two loans issued against your home, to be repaid monthly in the normal way.

Qualifying for a second charge mortgage means first building sufficient equity in your property. For example, if you own a home valued at £300,000 and have repaid £150,000 of your primary mortgage, you will have £150,000 equity that could be used to secure a second charge mortgage.

LTVs, interest rates and borrowing costs vary significantly from one lender to the next, making it essential to enlist independent broker support before applying.

What Are the Advantages of Second Charge Mortgages?

The immediate advantage of a second charge mortgage is the way in which it enables you to tap into the equity you have tied up in your home. Millions of homeowners are asset-rich but cash-poor, with the vast majority of their wealth existing as equity. If you need to raise capital for any purpose, such as major home improvements, releasing the money you have tied up in your home is an option.

A second charge mortgage can be advantageous over many comparable types of loans in a number of ways. They have the potential to be significantly more cost-effective, with much lower interest rates and overall borrowing costs. Higher loan-to-value loans are also available due to the security provided, offering access for larger sums of money than an everyday personal loan.

As with a standard mortgage, a second charge mortgage can be repaid over a number of years with affordable monthly instalments. If you can comfortably afford the repayments on your second charge mortgage, it could be a convenient, cost-effective, and surprisingly simple funding solution for almost any purpose.

Second Charge Mortgages for Debt Consolidation

Consolidating debts is another popular use for second charge mortgages, which depending on the borrower’s financial situation can save them money.  If you have a series of existing debts and outgoings at higher rates of interest, an affordable second charge mortgage could significantly reduce your monthly outgoings.

In addition, a second charge mortgage does not carry the same risk of credit score damage as a conventional consolidation loan. Just as long as you have enough equity available in your home to cover the loan, you are almost guaranteed to be accepted.

Independent Broker Support

Finding the best deal on a second charge mortgage means looking beyond the High Street and comparing deals from as many specialist lenders as possible. At UK Property Finance, we can provide the independent support and representation you need to find an unbeatable deal from a top-rated lender.

Call anytime for an obligation-free consultation, or e-mail UK Property Finance and we will get back to you as soon as possible.


Kossi Adzo is the editor and author of He is software engineer. Innovation, Businesses and companies are his passion. He filled several patents in IT & Communication technologies. He manages the technical operations at

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