More than two-fifths of UK homeowners unaware of second charge mortgages

  • 23/02/2023
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More than two-fifths of UK homeowners unaware of second charge mortgages
Some 43 per cent of homeowners in the UK do not know they can use second charge mortgages to release equity from their homes.

A report conducted by Together, Opportunities in Challenging Times, found that despite the growth seen in this part of the sector, a sizeable segment of the 2,000 people polled was unaware of the option.

This comes in light of figures released by the Financing and Leasing Association last week, which suggested that the value of lending in the market grew by 40 per cent annually in 2022.

However, 19 per cent of respondents said they were open to considering second charge mortgages to help with existing debt and loan consolidation this year.

According to the study, 15 per cent of homeowners do not know how much they will need to spend on improving their homes while 14 per cent are unsure of where they will source the money needed.


Second charge not widely available on the high street

James Briggs (pictured), head of personal finance intermediary sales at Together, said: “A second charge mortgage can offer a cost-effective route for homeowners needing to raise money for home improvement plans, when compared to remortgaging.

“This gives homeowners the option to release the equity in their property that they need for improvements, while keeping what may be a favourable, existing mortgage rate.

“However, as second charge mortgages are not widely available through high street lenders. It’s critical that people discuss their circumstances with a professional mortgage broker to understand how they can work as a viable option – be it for renovation plans or to help with debt consolidation this year.”

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