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What Is a Second Mortgage?

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Second mortgages (also called the second charge or 2nd mortgage , or secured loan) allows you to make use of your capital (the amount you have) within your house as security against loans.

Can I get an additional mortgage?

You have to be a homeowner but you don’t need to reside in the house to qualify for an additional mortgage.
It is essential to be able to demonstrate equity in your home
You must have a steady income, either through work or self-employment
You must be over the age of 18

As it sounds in the event that you apply for another mortgage, you’ll be able to have 2 mortgages for the property.

A second mortgage could offer you a variety of positive benefits. You can:

Borrow a large amount. Through a second mortgage, you can borrow up to £1,000,000 based on the equity in your home

Get approved without having having a perfect credit score. Because the loan is secured on your home, you might be able borrow even with a poor credit ratings. Second charge loans can be a great alternative if you’re struggling obtain approval for an individual loan (unsecured credit). This makes them a beneficial option for those who are self-employed and finding it difficult to prove your earnings

Repay the loan over a longer time. We’d suggest that you repay the loan over the most minimal amount that fits your budget The second mortgage may be repaid in the duration of up to 25 years.

Reduce your monthly expenses and earn more cash. If you decide to take the second mortgage option to consolidate debts then you could be able reduce the amount you have to pay each month to service debt. Also the longer the loan term you decide to go with, the shorter monthly payments will be for your second mortgage. However, the faster you pay back your loan the lower your monthly interest in the long run.

You can get a better price than you would receive from the refinancing. A lot of mortgages have the possibility of an early repayment cost which is applicable when you decide to switch to a new mortgage within a specified time. Therefore, while an remortgage, or a new mortgage might have a lower interest rate or a better rate however, if an early repayment fee is imposed, you may prefer to keep the loan you have and getting an additional mortgage.

You can choose to pay more. If your financial situation improves you’ll be able to pay more than you’re required to for your second mortgage, which will reduce how much interest that you pay.

Second mortgages are a great way to get a second mortgage.

The second mortgage to pay for nearly everything:

Enhance the value of your property through improvements to your home

Beautiful, well-thought-out new kitchen. A luxurious bathroom. A loft-style room in order to make use of of that wasted but useful space. Perhaps you’ve always dreamed of an extension. Or perhaps you’re desperate to remodel or repair your house. Whichever home improvement project you’re contemplating whether it’s a simple refresh or an extension, using an additional mortgage to fund the purpose of home improvements is a fantastic way to increase the value of your property.

You can free up money by taking out the second mortgage to fund consolidation of debt

We’ve experienced it ourselves. It’s easy to get an array of credit cards, loans or store cards, as well as overdrafts. The result is that you have the money coming from your bank account in all directions , and at various times of the month. That’s one reason why many people opt for second mortgages in order to combine a variety of smaller debts into a single cheaper loan.

Secured loans also provide a lot of flexibility with regards to the amount of the loan and the time period you take it out over (the time). This means that you can bring your debt under manage with only one monthly installment that you are able to manage and afford.

Cope with a large cost

It could be the time to go for it and pay for the wedding and honeymoon. Perhaps it’s that you require a reliable car to go to work. A second mortgage can help you pay for those huge costs you simply have to pay for.

Things to think about when deciding on the second mortgage

When used in a responsible manner When used properly, a second mortgage may offer you a wealth of benefits. However, since this can be a secured credit should you encounter financial trouble in the repayment of either the first or the second mortgage, your home could be taken over and then sold to pay the dues. The first mortgage will take precedence the remaining money being used to pay off your second mortgage.

Before you apply, make sure that you have

Be sure to think about:

What amount you would like to lend.
What length of time you’d like to lend it out for.
What you need to borrow the money for.
The value that you are currently paying for your home.
How much are you still owing for your mortgage.

Then, why not request an estimate of what options you have and it won’t impact your credit score and takes a few minutes. Contact us if you have any queries at all We’d love to assist you.