Second charge mortgages, also known as home equity loans, are an option if you own a property and require additional funds for unexpected expenses such as home improvements or debt consolidation. Second charge mortgages provide an alternative borrowing option for homeowners while keeping their existing mortgage in place. Our Maidstone advisers have significant experience in helping clients secure second charge mortgages, including fixed-rate second charge mortgages, variable rate second charge mortgages, and interest-only second charge mortgages.
A Second Charge mortgage is, as the name suggests, a separate and additional mortgage to the homeowner’s main (or first) mortgage.
Second charge mortgages (sometimes known as ‘Homeowner Loans’) are loans that are secured against the borrower’s residential property, and as such, are available only to homeowners. In common with remortgages, second charge mortgages are sometimes used by homeowners to raise money.
When considering a second (‘further’) advance, the lender will take into account the value of the borrower’s home, less any mortgage owed on it. The difference between the two amounts is known as ‘equity’ and provides the lender with security against the loan. If for example, the home is estimated to be worth £300,000 and the amount remaining to be paid on the mortgage is £100,000, the equity is £200,000. In addition to the amount of equity that’s available, the lender will consider the borrower’s ability to service both mortgages if interest rates were to rise.
By taking a second mortgage, the homeowner will have two mortgages on their home. In common with a first mortgage, the borrower’s home will be at risk if he or she fails to keep up the mortgage payments.
When the property is sold, or the homeowner moves to a new home, the amount owing on the first mortgage must be repaid in full before anything is paid off the second mortgage.
Generally speaking, lenders charge a higher rate of interest on second charge mortgages than they do on first or main mortgages. The rate of interest (which may be fixed or variable) can also depend on the size and term of the loan, the homeowner’s credit rating, and the amount of equity that exists in the home.
We'll assess your specific circumstances, explain the different secondcharge mortgage options available, and ensure you understand the full implications before proceeding. Contact us today for a confidential consultation.
What were the circumstances that caused you to initially look for an adviser?
For our mortgage application
How has Jenny Whyte helped you?
With the mortgage application and made the entire process so much easier and speedy.
Have you seen the outcome you were hoping for?
Yes we were able to purchase our property within a two month period
What could they have done better?
Nothing as Jenny was excellent and I have since referred her to others
Jenny's reply
Thanks Linda and for recommending me to your friends! I will be in touch soon to discuss your remortgage.
What were the circumstances that caused you to initially look for an adviser?
We've used Jenny before to help secure a mortgage, so when our fixed term was coming to an end, we were happy to use her services again.
How has Jenny Whyte helped you?
she helped us renew our mortgage.
Have you seen the outcome you were hoping for?
Yes, we're on the best fixed rate we could have achieved under the economic circumstances.
Jenny's reply
Thanks Kate for the review. I hope you have a fantastic special birthday celebration in July!
What were the circumstances that caused you to initially look for an adviser?
We initially contacted Jenny to find out about mortgage options for us.
How has Jenny Whyte helped you?
Jenny has gone above and beyond to support us in our first house purchase together. From navigating mortgage options that suit us and not pushing us into just any deal to thoroughly explaining all the different options when it comes to insurance and protection. She has also been incredibly helpful when our initial sale fell through. She kept us in the loop, every step of the way and responded to our queries and questions with lightening speed and has always been available when we needed her. She has given us exceptional service throughout.
Have you seen the outcome you were hoping for?
Yes.
What could they have done better?
Nothing. Honestly, everything has been perfect.
Jenny's reply
Thank you Victoria and Graham for the lovely review. Fingers crossed for a smooth house move!
What were the circumstances that caused you to initially look for an adviser?
We was after some help in finding the best mortgage interest rates and advice on what type of mortgage to go for.
How has Jenny Whyte helped you?
Jenny helped us by explaining different types of mortgages and their pro’s and con’s. She also managed to find us mortgages that accept price work which was helpful. Jenny managed to get us a rate we was happy with.
Have you seen the outcome you were hoping for?
Yes
Jenny's reply
Thank you James and Jasmine for the lovely review, it's been fantastic to work with you both. I hope the house move goes smoothly!
What were the circumstances that caused you to initially look for an adviser?
Remortgage
How has Jenny Whyte helped you?
Advised on available mortgages
Have you seen the outcome you were hoping for?
Yes
What could they have done better?
Nothing
