Also known as a secured loan is secured by way of second charge on a residential property.
The first mortgage stays in place and the equity between the value of a property and the outstanding mortgage balance can be used as security for a second charge.
Since the Mortgage Credit Directive was introduced in 2016, if a client is looking to raise funds and approaches a mortgage adviser for help, that adviser must now consider second charges as a viable lending option.
The advisor can then compare the benefits alongside either a remortgage or a further advance and unsecured credit.
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