For customers who have unconventional modes of income or employment, or those who are locked into fixed-rate mortgages. Also you may have a prohibitive Early-Repayment Charge or wish to borrow at a higher loan-to-value ratio or protect an existing mortgage rate. These are just a few of the scenarios in which re-mortgaging options can often be unsuitable.

Second charge lending plays a vital role in the structure of personal financing and has a very important part to play in the future. This form of funding offers speed and flexibility which high street lenders simply cannot compete with.

Borrowers over the last 2 years have grown in confidence and are using second charge finance for many different uses. The costs of this form of lending have reduced significantly over the past few years, therefore making second charges far more competitive and practical than in the past.

The second charge sector has changed dramatically for the better over the past 5 years as lenders have seen the gap in the market for this type of loan. No longer is a second charge seen as a last option and is now a serious player in the short and long-term lending market.

The industry’s huge growth over the last few years proves homeowners have become aware of the ways this form of loan can help their plans progress. This type of loan is quick to complete, a straightforward case can be finalised in just a matter of days rather than weeks which always help’s the borrower.

Like to know more?

When taking out a new loan you should seek independent professional advice, we have a team of experts waiting to take your enquiry so please do make contact. 

Why would one opt to take the second charge route rather than re-mortgage?

Lots of reasons actually. For example, many customers have a really good first mortgage deal, maybe a great fixed or tracker rate that they don’t want to give up. Taking a second charge at a higher rate may mean that the blended rate across the whole debt is still lower than a new first deal, so a second charge loan can make good financial sense.

Some borrowers may face a stiff early repayment charge on their first mortgage if they re-mortgage. Others may have had a change in their circumstances which means switching to a bigger first charge mortgage is not an option. Perhaps they started a family or changed jobs resulting in a different source of income. Let’s not forget, second charges can be considerably quicker to complete than re-mortgages, especially with the expanded use of Automated Valuation Models.

Confusing

Raising funds or borrowing money at any time in life especially nowadays can be very daunting and expensive if you get it wrong. There will be various reason you need to raise cash and many options open to the majority.

First piece of advice to heed is to get professional advice as the wrong loan over a period of time could cost thousands more than you need to pay.

Generally, a second charge or secured loan will be cheaper than one unsecured but again do seek advice as this is not always the case. Using a reputable broker will help eliminate a lot of the questions as they are experienced with all types of lending.

Way forward

Second charge loans do not suit every need and it is vitally important any potential borrower seeks professional independent advice from a qualified adviser. If you would like to discuss a potential loan please do contact one of our fully qualified advisers.

Homeowners, do you turn to credit to help make ends meet?

Could a second charge loan could help you?

It is an increasingly popular solution as those credit agreements can quickly add up – and monthly repayments could start getting out of control as a result. With these extremely hard and strange times we are living in more stress is just what we all do not need.

Why not consolidate?

Turning debts into a single, more affordable monthly payment could make a huge difference to your finances, and with loan rates so low, it could be a great time to give this idea serious consideration.

A second charge loan may be the answer

According to the latest research, the ongoing cuts to secured loan pricing mean that customers who switch or take out a new loan today can save hundreds of pounds over the term of their agreement.

This is largely thanks to intense competition between providers. Quite simply, lenders want you to come to them for your borrowing needs as they’ll earn interest from you, and they’re willing to lower their rates in order to secure your business. So why not take advantage?

Your monthly repayments could be far lower by consolidating your credit cards, for example. You may even want to consider taking out a new low-rate loan to replace a current one which may be far too expensive.

Please remember before you decide seek professional independent advice as this WILL NOT suit every situation.

Can we help?

If you would like to review your current loans and require more information how a second charge loan could help you please get in touch.

A new campaign is being launched very soon to tackle mortgage and second charge loan myths and highlight the importance of professional advice when it comes to taking out a secured loan.

More stringent lending rules are making it tougher to get a mortgage, and yet new research shows that more than half – 58% – of consumers, including many landlords, may end up with the wrong loan, because they are unaware that a mortgage broker can offer a greater product choice than a bank or building society.

This new study found that nearly 30% of respondents thought that brokers and banks have access to the same products, when in fact using an independent broker can give you access to nearly 15 times more products.

When asked whether they agreed with a series of statements about mortgage advice, one in six thought their bank or building society would be able to give them access to the same impartial advice as a mortgage broker.

The Mortgage Myths campaign aims to put the spotlight on misunderstandings like these, highlight the valuable role of independent advice from a mortgage broker and encourage consumers to speak to an adviser about their lending options.

As an industry, there clearly is a significant amount of work to be done to change these attitudes, educate consumers and promote the advantages of using a mortgage broker.

Although some consumers appear to believe they have secured the best deal possible by going directly to their lender, without speaking to a broker they could be missing out on thousands of lending products that might be even better suited to their needs.

Like to know more?

Please do make contact and one of our fully qualified independent advisers will be happy to help.