Many of our clients need access to funds above and beyond the realms of regular mortgages. Breakthrough are here to help you navigate the options available to you through Bridging Finance, Second Charge Mortgages and Secured Loans. So what’s the difference?
Bridging finance is a specialist area which Breakthrough can support you with. Typically, a short-term loan of 18 months or less, usually for the purpose of buying property to refurbish and sell or refinance later, or to bridge-the-gap between buying a property using an interim loan before selling another property in order to repay the bridging finance. Whether you’re looking to borrow in a private name or through a limited company our clients generally look to access this type of funding because they need swift access to funds or want to borrow to fund renovation works or property investment purposes. Speak to one of the team to discuss all the options available to you.
A mortgage is a loan secured against your home. Your home may be repossessed if you do not keep up repayments on your mortgage or any other debt secured on it.
Second Charge Mortgages or Secured loans operate in the same way and involve taking out a second charge against your property/mortgage which allows you to use your home to borrow more money, for example to cover the cost of home improvements. It can be a useful alternative to remortgaging to access additional borrowing – especially if you will face penalties to switch away from your current mortgage. A second mortgage is completely separate from your original mortgage and can be a good way to access extra funds without remortgaging. However, it will mean you have two mortgages to pay off on the property and means that if you default on your payments, you’re at risk of losing whatever is being used as security. So, you could have your home repossessed to pay off the debt.
As the lender has security, you may be offered lower interest rates and longer terms than if you took out an unsecured loan. You may also be able to access this type of loan over an unsecured loan if your credit score isn’t the best. You must consider carefully if this type of loan is right for you and our team will discuss all options suitable for your needs.