Second Charge Mortgage’s (secured loan)
A Second Charge Mortgage (secured loan) is a perfect alternative to remortgaging. If you are tied into your mortgage in a fixed rate the likelihood is that you have heavy penalties to take funds out of your property and renew early. With a secured loan, you could take further funds out of your property without the need to affect your mortgage and merge the two together once your fixed rate comes to and end without penalties if you wished to do so. Also, as the loan is against your property, the rates are usually much lower than a personal loan.
They are usually much easier to obtain than a mortgage or personal loan as we can consider things such as:
- Poor credit
- Higher loan to values
- Various loan purposes
- Affordability issues – will usually take into account incomes such as bonus/over time/agency workers/bank shift
Debt consolidation – Has your credit increased due to lockdown, improvements to your home or even just the cost of living? You could look at merging your credit together, whatever the amount, and put this into 1 much lower monthly payment. Don’t forget, the average interest rate on a credit card is approximately 19.9%, some even going up to 39.9%.
Home improvements – New kitchen, new bathroom, decorating, garden landscaped (or even all!) then this could be your answer. Most people will wait until the mortgage is due for renewal due to the redemption charges. A secured loan could be a much quicker way to obtain the funds and upgrade your home earlier. Maybe even increasing the value of your property ready for when your mortgage is due for renewal.
Investment purposes – want to start a buy to let portfolio? Or even enhance the one you already have? Funds can be raised for the purchase of new properties and can be secured against your residential or even buy to let property.