Second Charge Mortgage Calculator UK

Are you thinking of getting a second charge mortgage for your home but aren't sure about the cost or the process to get one?

In this friendly guide, we’ll explain:

• How much you can expect to pay for a second charge mortgage.
• How long it takes to get a second charge mortgage.
• Whether a lender can refuse the second charge mortgage.
• Whether your credit score can prevent you from getting a second charge mortgage.
• What the rates are for a second charge mortgage.

Use the calculator as a starting illustration and discuss the actual terms and risks with an appropriately qualified adviser. See related guidance.

How does a second charge mortgage calculator work?

A calculator uses stated inputs such as loan amount, rate and term. An equity or loan-to-value estimate does not verify eligibility or affordability. See related guidance.

The result depends on the assumed rate, repayment method and fees included. Check what is excluded before comparing it with another illustration.

How to compare second charge mortgages

Modern second charge calculators use a slider scale to change how much you wish to borrow and how long you want to repay. This makes it quick and easy to see how repayments are predicted to change based on different amounts and loan terms. They are a good way to research the market and compare second charge mortgages. 

Where can I use a second mortgage calculator?

Second mortgage calculators are found on the websites of lenders offering these products, such as banks. They are typically found on the same page advertising the secured loan to make them easily accessible. 

Calculators vary in scope and availability. Their absence does not establish why a lender markets or arranges its products in a particular way.

Is a second charge mortgage calculator accurate?

A calculator estimates payments using its stated amount, rate and term. It is not a lending offer, eligibility confirmation or suitability assessment. Compare the personalised terms and total cost before applying.

The consumer-credit representative-APR rule is not a test of a mortgage calculator’s accuracy. It does not mean that 49% of calculator users receive an inaccurate result.

There is no universal “maximum representative rate” that tells you the highest rate you can be offered. Obtain a personalised mortgage illustration showing the actual rate, fees and payments.

Do I have to use a second charge mortgage calculator?

You do not have to use a calculator. If you do, treat its results as estimates under its assumptions, not approval or a personalised offer.

An adviser can assess options and explain costs, but you still need to review the offer and provide accurate information. Check the adviser’s relevant FCA permissions.

How long does a second charge mortgage take?

Timing varies with the lender, valuation, documents and legal work. Ask for a current estimate rather than relying on a universal three-week to two-month range.

Sometimes, an appraisal of your home is not needed, and the second charge loan is approved quicker. 

Make sure you have all of the necessary documents together, such as proof of your income and recent bank statements, before applying so that the process goes as smoothly as possible.

Can a lender refuse a second charge?

As part of responsible lending, and as stated by the Financial Conduct Authority, lenders must robustly assess your suitability for any loan and ensure the loan amount is affordable to you. Lenders can refuse your application if they believe the second charge would put pressure on your personal finances and possibly even cause you to struggle. 

Affordability considers acceptable income, commitments, essential spending and relevant changes. No single debt-to-income percentage decides every second-charge application.

Can I get a second charge with a poor credit score?

Some lenders consider applicants with adverse credit, but criteria and rates differ. A US-style HELOC should not be assumed to be an equivalent available UK option.

You can even find some lenders targeting their ads to people with poor credit. They advertise a product known as a bad credit loan.

Security does not guarantee approval or suitability. The home is at risk if required payments are not maintained.

Second charge mortgage rates

This forum user on MoneySavingExpert is thinking about taking out a second charge mortgage and is looking for advice on what the interest rates would be on this.

Rates and eligibility change and depend on the product and your circumstances. Obtain a current personalised quotation or mortgage illustration and compare the total cost, fees, rate type and repayment terms; figures in this article are not live offers.