Second charge lending has undergone a transformation in the past year, emerging as a faster, more flexible option that’s often delivering better outcomes for clients than traditional alternatives.
Much of this evolution has been driven by new entrants who are rethinking how second charges are delivered. Their innovation has pushed the wider market forward, with more lenders digitising their processes to keep pace. Today, everything can be submitted online – including legal charges, ID, Direct Debit details, and supporting documents – resulting in a much more streamlined process. In many cases, funds can even be released before consent from the first charge lender is received.
In one recent example, the fact find was completed on a Tuesday and the funds were released by Thursday. While that’s an extreme case, we’re now regularly seeing completions within 10 days to two weeks – a significant improvement from the three to four weeks that were typical this time last year.
There has also been progress in how lenders assess affordability and support brokers. Stress testing on five-year fixed rates has become more accommodating, and we’re seeing welcome innovation around early repayment charges. One lender has introduced staggered ERCs across a five-year term, making these products far more attractive – and others are likely to follow.
Across the board, there’s a shift towards speed, flexibility, and service. AVMs are being used more frequently as standard, packaging requirements are being simplified, and underwriting is becoming more pragmatic. All of this points to a more dynamic, borrower-friendly second charge market – especially for those with complex income or time-sensitive needs.
These improvements are not just about efficiency. They’re unlocking new use cases. When funds can be accessed faster, second charges become relevant in situations where speed is critical – from seizing investment opportunities to refinancing ahead of a rate change. Even where the rate might be slightly higher than a further advance, the speed and certainty often tip the balance.
If second charges haven’t featured in your client conversations lately, now is a good time to reconsider. With better products, faster turnaround times and more consistent outcomes, second charges are no longer niche. They’re a powerful, mainstream option that’s delivering real value.
