Second Charge Mortgages

A second charge mortgage is essentially a loan that’s secured on your property, allowing you to borrow money whilst leaving your existing mortgage in place. If you’re considering a second charge mortgage, our qualified advisers have put together some core information to help you make the right decision.

How does a second charge mortgage work?

Unlike loans and credit cards, a second charge mortgage is a secured loan using your home’s equity. It’s separate from your main mortgage, meaning separate payments and two mortgages to manage.

Why take out a second charge mortgage?

One of the main reasons why people opt for a second charge mortgage is that their current mortgage lender will impose large charges for early repayment or moving away to another deal. Alternatively, it could be that you’ve taken out a very good rate of interest on your current mortgage and remortgaging would mean moving to a much higher rate.

Here's a breakdown of how it works

  • Equity You can only borrow up to a certain amount based on the equity you have in your home. This is the difference between the current value of your property and what you still owe on your first mortgage.
  • Separate loan It’s completely separate from your first mortgage, meaning different lenders, terms, and interest rates could apply.
  • Repayment You make monthly repayments for both your first and second mortgages simultaneously.
  • Priority If you can’t repay and your home is repossessed, the first mortgage lender gets their money first, followed by the second mortgage lender.

Reasons for taking a second charge mortgage

  • Raise extra money It can be a way to access funds for various purposes like home improvements, debt consolidation, or unexpected expenses.
  • Avoid remortgaging penalties If you’re locked into a fixed-rate mortgage with early repayment penalties, a second charge mortgage might be an alternative.

Things to consider before taking one

  • Higher interest rates Second charge mortgages typically have higher interest rates than first mortgages.
  • Risk of repossession If you can’t repay, you risk losing your home.
  • Debt burden It adds another monthly repayment, increasing your overall debt.
Second charge mortgages team

Is a second charge mortgage right for me?

A second charge mortgage is only available if you currently have a mortgage on your home. However, you can take out a second charge mortgage even if you don’t live in the property, such as in the case with a buy-to-let mortgage on a property you rent out.

Before you take out a second charge mortgage, your current mortgage lender needs to approve the application. This requires giving evidence that you can pay both mortgages without any difficulty.

Our qualified advisers assess your needs help you decide on the best option for your circumstances and longer term goals.


Your home may be reprocessed if you do not keep up repayments on your mortgage.

Get in touch

Fill in the form below and our trusted advisers will be in touch to provide expert advice.

Financial advisory in Worcestershire and Kent

Based in Droitwich Spa, we’ve proudly supported clients of all ages since 2004. The opening of our second office in Sevenoaks allowed us to extend our bespoke financial services even further, making SN Financial a trusted financial adviser for individuals, couples, families and businesses across Worcestershire, Kent and the rest of the UK.

Droitwich Office

5 Saltway, Droitwich, Worcestershire, WR9 8LB
01905 779697

Sevenoaks Office

46 Holly Bush Lane, Sevenoaks, Kent, TN13 3TL
01732 926255