Second Charge Loans

A Second Charge Loan is a secured funding facility that allows you to release the equity tied up in your residential or investment property without altering or replacing your existing primary mortgage. It acts as a separate, additional loan secured against the property, providing a flexible and effective way to raise capital for a wide variety of personal and business purposes.

This type of finance is particularly valuable for property owners who are currently on an exceptionally low fixed-rate mortgage and do not wish to disturb those favourable terms by remortgaging. At Knightly Group, our team of specialist advisers can assess your unique situation and expertly guide you on whether a second charge loan is the most suitable and cost-effective solution for your goals.
 

Strategic Applications & Benefits

While remortgaging is a common way to raise funds, a second charge loan often presents a smarter alternative in many scenarios:

• Protecting Your Existing Mortgage Rate: If your primary mortgage has a very competitive interest rate, or if it carries significant early repayment charges, a second charge loan allows you to raise capital without affecting it.

• Funding Home Improvements: A perfect way to finance a significant extension, loft conversion, or major refurbishment project to add value to your home.

• Business Capital Injection: Raise funds to start a new business venture or inject working capital into an existing one.

• Debt Consolidation: Consolidate multiple, higher-interest unsecured debts into a single, more manageable monthly payment.

• Flexibility for Complex Situations: The second charge market can often be more flexible than mainstream mortgage lenders, with specialist providers who can cater to complex income structures or those with a less-than-perfect credit history.
   

Key Features & Lending Criteria

We have access to a comprehensive panel of second charge lenders, enabling us to source competitive and flexible terms tailored to you.

• Loan to Value (LTV): In certain circumstances, loans are available for up to 95% of the property's value, when combined with your existing mortgage. However, a lower combined LTV will typically result in access to more competitive interest rates.

• Property Types: We can arrange second charge loans on both owner-occupied residential homes and investment properties, including Buy-to-Lets (BTLs).

• Loan Purpose: Funds can be used for almost any legal purpose.

• Affordability: Lenders will assess your income and outgoings to ensure the loan is affordable alongside your existing mortgage and other commitments.
   

An Important Note on Your Commitment

A Second Charge Loan is a significant financial commitment that is secured against your property. Just like a primary mortgage, it is crucial to ensure you can comfortably afford the repayments before proceeding. If you fail to keep up with your repayments, the property could be at risk. Our advisers are committed to responsible lending and will conduct a thorough assessment to ensure the facility fits within your budget.
 

Our team of specialist finance experts is on hand to help you navigate your options, providing clear, impartial advice to help you make an informed decision.