Is a second charge the same as a secured loan?

Yes — 'second charge mortgage', 'second charge loan' and 'secured homeowner loan' are different names for the same product. It is a loan secured against the equity in your property, sitting behind your existing first-charge mortgage.

How much can I borrow on a second charge?

Typically up to a combined loan-to-value of 70-85% including your first mortgage, depending on the lender and your credit profile. If your property is worth £400,000 and you owe £200,000 on the first mortgage, a second charge up to roughly £80,000-£140,000 is usually in range.

Are second charge rates higher than remortgaging?

Second-charge rates are typically higher than prime mortgage rates but often competitive with specialist remortgage rates. The economics work best when your existing first mortgage has an attractive rate you want to keep.

Will a second charge affect my first mortgage?

No. Your first-charge lender consents to the second charge but your original mortgage terms, rate, and term remain unchanged.

Second Charge Mortgage UK — Guide For Declined Homeowners

A second charge mortgage (also called a secured homeowner loan) is a loan against the equity in your property that sits behind your existing first-charge mortgage. It is often the right answer when you need to raise additional funds but you want to keep your current mortgage in place — because the rate is attractive, the product has an early-repayment charge, or a remortgage would be declined.

How a second charge works

Your property has a first charge — your existing mortgage. A second charge lender adds a second legal charge behind the first one, and lends you money secured against your equity. Your original mortgage continues unchanged. You have two monthly payments instead of one.

Combined loan-to-value (CLTV) is the key metric: total lending (first + second) divided by property value. Most second-charge lenders lend up to 70-85% CLTV, depending on the lender, your credit profile, and the property type.

When a second charge beats a remortgage

Second charges win in several scenarios:

You have an attractive current rate you want to keep. A fixed mortgage at 3% should not be replaced by a specialist remortgage at 6%.
Your current mortgage has a high early-repayment charge. The ERC makes a full remortgage uneconomical.
Your remortgage would be declined but a second charge will not. Second charge lenders have different underwriting criteria and often accept cases a mainstream remortgage would reject.
You need funds quickly. Second charges typically complete in 3-5 weeks, faster than a full remortgage.

When a remortgage beats a second charge

Your current mortgage rate is unattractive or the product is ending soon.
You can remortgage onto a competitive rate for the whole loan.
You want a single monthly payment rather than two.

Typical second-charge criteria

Specialist lenders on our panel underwrite second charges with similar case-by-case flexibility as their first-charge products:

Adverse credit (CCJs, defaults, missed payments) is acceptable within policy bands.
Self-employed income is underwritten on latest-year accounts, retained profits, or day-rate.
Loan amounts typically £10,000 to £500,000+.
Terms 3-30 years.
Most property types accepted, including non-standard construction.

What second charges are used for

Home improvements and extensions.
Debt consolidation.
Business funding (where the borrower is a homeowner rather than a business).
Tax bills and large one-off expenses.
Funding a property purchase where the first mortgage cannot be remortgaged.

Frequently asked questions

Is a second charge the same as a secured loan?: Yes — "second charge mortgage", "second charge loan" and "secured homeowner loan" are different names for the same product. It is a loan secured against the equity in your property, sitting behind your existing first-charge mortgage.
How much can I borrow on a second charge?: Typically up to a combined loan-to-value of 70-85% including your first mortgage, depending on the lender and your credit profile. If your property is worth £400,000 and you owe £200,000 on the first mortgage, a second charge up to roughly £80,000-£140,000 is usually in range.
Are second charge rates higher than remortgaging?: Second-charge rates are typically higher than prime mortgage rates but often competitive with specialist remortgage rates. The economics work best when your existing first mortgage has an attractive rate you want to keep.
Will a second charge affect my first mortgage?: No. Your first-charge lender consents to the second charge but your original mortgage terms, rate, and term remain unchanged.