Second Charges Referral for Connect Network Members
A secured loan may provide a benefit to your clients in any of the following scenarios:
- Avoiding substantial ERCs or higher interest rates from remortgaging.
- When the existing lender declines a Further Advance.
- Consolidating unsecured debts for better financial management.
- Managing adverse credit to improve future remortgage options.
- Financing home improvements (builders’ quotes or planning permissions may apply).
- Raising funds for business purposes without shifting to specialist lenders.
- Providing a deposit for a BTL property (specific documentation may be required).
- Supporting a Transfer of Equity after divorce (with solicitor and lender confirmation).
- Paying off tax bills directly to HMRC with verified arrangements.
Our lender partnerships enables us to tailor loan solutions to meet your clients' specific financial circumstances
Working with our team, you’ll benefit from:
Deep lender relationships for tailored solutions.
Expert criteria matching to secure the right deal.
Fast and seamless process from start to completion.
Whether it’s home improvements, debt consolidation, or other client needs, we’re committed to helping you complete more cases efficiently and effectively.
Flexible Loan-to-Value (LTV) Ratios:
Second charge loans up to 100% LTV.
Third charge loans up to 75% LTV.
Efficient Valuation Process:
Approximately 60-80% of applications completed via Automated Valuation Models (AVM).
Simplified Affordability Assessments:
Options without Loan-to-Income (LTI) calculations, focusing solely on affordability.
Versatile Funding Purposes:
Financing available for business use.
Joint borrower sole proprietor arrangements to enhance affordability.
Accommodating Employment Histories:
Eligibility with just one year of self-employment.
Consideration for applicants with one month of employment history.
Acceptance of return-to-work pay for those resuming from maternity leave within six months (employer letter required).
Diverse Income Sources Recognised:
Use of CIS payslips instead of tax returns.
100% acceptance of secondary incomes (up to 60 hours per week, with minimum tenure in both roles).
Adverse Credit Considerations:
Lenders accommodating recent or current secured arrears, significant defaults, CCJs, and Debt Management Plans.
Flexible Product Options:
A range of products, including variable rates with no Early Repayment Charges (ERC), and fixed rates for 2, 3, 4, or 5 years.
Availability of 5-year fixed rates with no ERC
Case Study | Name of Study
Background:
Mr. and Mrs. Taylor are a couple in their early 40s who have been living in their family home in Manchester for over 15 years. Their property is valued at £350,000, and they have a remaining first charge mortgage balance of £120,000. Their interest rate is favorable at 2.5%, and they did not want to disturb this arrangement.
Recently, the Taylors decided to renovate their home to include a modern open-plan kitchen and a small extension to create a home office. They received quotes from contractors, estimating the renovation cost at £50,000.
Challenge:
The couple explored increasing their first charge mortgage but realized it would mean losing their current low rate and incurring early repayment charges of £4,000. They also looked into personal loans but found that borrowing such a large amount through unsecured credit would result in higher monthly repayments.
Solution:
Their mortgage adviser, Sarah, suggested a second charge loan as an ideal solution. This option allowed them to borrow the £50,000 they needed without impacting their current mortgage terms.
Details of the Second Charge Loan:
- Loan Amount: £50,000
- Term: 10 years
- Interest Rate: 4.2% fixed for the first 5 years
- Monthly Repayment: £513
Outcome:
With the second charge loan, the Taylors could proceed with their home renovations without disturbing their existing mortgage. They were able to complete their dream kitchen and create a functional workspace, increasing both their home’s value and their quality of life.
Key Takeaways for the Adviser:
- Second charge loans can be a flexible solution for homeowners who need access to funds but want to avoid altering their primary mortgage.
- It’s essential to assess the client’s existing mortgage terms, early repayment penalties, and overall affordability to ensure this solution fits their financial situation.
Dan Burdett
Head Second Charges
01708 973227
Jake Syms
Second Charges
01708 973234
