A second-charge mortgage is a loan secured against a property’s equity that is taken out alongside an existing mortgage. As it is secured borrowing, there is a risk of repossession if your monthly repayments are not kept up with.
It is sometimes used where changing an existing mortgage is not preferable, for example, to avoid early repayment charges, retain an existing rate, fund home improvements or consolidate debts.
Interest rates are often higher on second-charge mortgages than on first-charge mortgages.
Availability and terms depend on factors such as property equity, income, credit history and affordability, with applications being assessed on an individual basis according to regulatory requirements.
