Second charge mortgages

A second charge mortgage (sometimes called a secured loan or homeowner loan) is a separate loan, usually from a different lender, secured against your home and sitting behind your existing mortgage. It has its own rate, term and monthly payment, and your existing mortgage carries on unchanged.

If your home is sold, your main mortgage is repaid first and the second charge lender is repaid from what’s left. That’s why it’s called a second charge.

Homeowners usually look at a second charge mortgage when they want to raise money but keep their main mortgage as it is, for example because:

• their main mortgage is on a low fixed rate they want to keep
• leaving their current deal early would mean a large early repayment charge
• their current lender won’t lend them more

The money is often used for home improvements or a large one-off cost. Some people use it to pay off other debts, which has extra risks, set out below.

• Your application goes to a second charge lender, usually through the specialist adviser. The lender checks your income, outgoings and credit history, and how much your home is worth compared with what you already owe on it.
• How much you can borrow depends on the lender’s criteria, your income and the equity in your home: its value minus what you owe on your main mortgage.
• Your main mortgage lender is usually told about the second charge, and some need to agree to it.
• You repay it over its own term, with its own monthly payment, alongside your main mortgage.
• When you later remortgage, you’ll usually need to pay off the second charge or ask its lender to agree to stay in second place.

• Rates are usually higher than on first mortgages, because the second lender is repaid only after your main mortgage.
• Some second charge mortgages have variable rates, so your payment can go up, and many have early repayment charges of their own.
• Arrangement, valuation and sometimes broker fees apply, and on a smaller loan, the fees make up a bigger share of what you borrow.
• You’ll have two loans secured on one home. Miss payments on either and your home is at risk.
• Rolling credit cards or personal loans into a second charge can cut your monthly payments, but it turns debt that wasn’t secured on your home into debt that is, and stretching it over a long term can increase the total you repay.

If you’re worried about debt, you can get free, confidential debt advice from MoneyHelper (opens in a new tab).

A second charge is one of the main ways to borrow more against a home you already own. Others are a full remortgage, or a further advance from your current lender. Our guide compares these three: Second charge mortgages in South Wales.

Remortgaging is something we do advise on: see Remortgaging and product transfers.

For a smaller amount, an unsecured personal loan is another option. It isn’t secured on your home, though the rate you’re offered depends on your credit history.

If you’re thinking about a second charge mortgage, get in touch and we can talk through what you’re hoping to do. We’ll explain how a referral works and, if you’d like to look into a second charge, put you in touch with a specialist adviser.

We don’t advise on second charge mortgages, so we won’t recommend one. That advice, and any recommendation, comes from the specialist adviser. Here’s how a referral works:

1. 1

   A free call with Phillip

   Tell Phillip what you’re hoping to do. He won’t advise you on second charge mortgages, but he can talk through what you’re looking for and explain how a referral works.

2. 2

   Your permission first

   With your agreement, Phillip passes your name and contact details to a specialist adviser within the Stonebridge network. We’re an Appointed Representative of Stonebridge Mortgage Solutions Ltd. Nothing is passed on without your permission.

3. 3

   Advice from the specialist adviser

   The specialist adviser should contact you and give you advice. They should explain their fees, and how they’re paid, before you decide anything.

Prefer to write? Send Phillip a message. Phillip replies within one working day.

Last reviewed 13 October 2026.