Remortgaging Has Been the Standard—But Is It Still the Smartest Way to Raise Funds?
In the UK, remortgaging has long been the traditional route for raising capital from your property. Whether you’re a homeowner looking to fund renovations, a landlord planning a portfolio expansion, or a developer needing quick liquidity—remortgaging might seem like the obvious choice.
But here’s the problem…
👉 Remortgaging can come with delays, early repayment charges, and a total reset of your mortgage terms—which might cost you more than you think.
There’s another option:
A second charge bridging loan.
If you’re not familiar with the term, don’t worry. As an experienced commercial finance broker at Sunrise Commercial, I’ll walk you through the clear, simple differences—and help you decide which option is right for your next move.
What Is a Second Charge Bridging Loan?
A second charge loan is a short-term secured loan that sits behind your existing mortgage. It lets you access the equity in your property without changing or interfering with your current mortgage deal.
Perfect for:
- Investors on a fixed-rate mortgage who don’t want to trigger penalties
- Landlords needing short-term capital for refurbishments or purchases
- Property developers and investors looking for fast funds to bridge a gap
It’s called “second charge” because it takes second priority to your main (first charge) mortgage lender in the event of a sale or repossession.
Remortgage vs. Second Charge Loan: The Key Differences
Here’s how the two compare, side by side:
| Feature | Remortgage | Second Charge Bridging Loan |
| Speed | Can take 6–12 weeks | Funds in 5–14 days |
| Early Repayment Charges (ERCs) | Often apply | None |
| Credit Check Impact | Full affordability & credit score checks | More flexible underwriting |
| Mortgage Disruption | Yes – replaces current deal | No – sits alongside existing mortgage |
| Best For | Long-term borrowing | Short-term capital needs |
When Is a Second Charge the Smarter Choice?
Here are three common scenarios we see at Sunrise Commercial:
1. You’re Locked Into a Low-Rate Mortgage
Let’s say you fixed your mortgage at 2% in 2021 for 5 years. Now you need £150,000 for a new development or refurbishment.
Why remortgage and jump to 5.5% or higher?
A second charge loan keeps your main mortgage intact—saving you thousands in interest and early exit fees.
2. You Need Funds—Fast
A remortgage can take weeks of underwriting, valuation, and solicitor work.
A second charge bridging loan can be approved and funded in under three weeks—ideal when speed is key, like buying below market value or refinancing to avoid penalties.
3. You Have Adverse Credit or Complex Income
Remortgages rely heavily on income multiples, credit scores, and bank criteria.
With a second charge loan, we can structure deals around your real-world situation—whether you’re self-employed, have multiple income streams, or a recent blip on your credit file.
The Truth? You Don’t Always Need to Remortgage
Most property owners are told remortgaging is the only way to raise funds. But the truth is, in many cases, it’s the slower, more expensive option.
At Sunrise Commercial, we work with private lenders, family offices and specialist banks to secure tailored second charge bridging loans across the UK.
What We Offer at Sunrise Commercial
- Rates from 0.95% per month (interest rolled or serviced)
- Loan amounts from £26,000 to £10 million
- Terms from 3 to 24 months
- No exit fees or hidden charges
- Fast, flexible underwriting—even for complex deals
- Second charge loans across residential, BTL, commercial, and mixed-use assets
Whether you’re a developer, landlord, or homeowner—we’ll find the right funding solution for your project, and explain it in simple, jargon-free terms.
Case Study: When a Second Charge Loan Saved the Deal
Client: Landlord in Manchester
Property Type: £750,000 tenanted HMO
Funding Need: £200,000 to refurbish a new BTL acquisition, but didn’t want to lose their existing mortgage rate (2.3%)
Challenge: Remortgaging would have triggered £8,000 in early repayment fees and raised the main mortgage rate to 5.2%
Solution:
We arranged a £200,000 second charge bridging loan at 0.95% per month, secured against the equity in the existing HMO. The landlord kept their main mortgage, completed the refurb, and refinanced later — saving time and thousands in interest.
Frequently Asked Questions About Second Charge Loans
1. Will a second charge loan affect my existing mortgage?
No. It sits behind your main mortgage and doesn’t change its rate, term, or lender.
2. Is a second charge loan only for property investors?
Not at all. It’s ideal for:
- Homeowners needing quick capital (e.g. for home improvements or business use)
- Landlords looking to expand
- Developers funding the next project
3. Can I get a second charge loan with bad credit?
Yes, we work with specialist lenders who look at the property’s equity and exit strategy, not just your credit score.
4. How fast can I get the funds?
In most cases, 5–21 days from application to funding.
5. What’s the maximum I can borrow?
We offer loans from £25,000 to £10 million, up to 70% LTV (based on the property’s value or equity).
Why Sunrise Commercial? More Than Just a Broker
When you call Sunrise, you’re not speaking to a call centre — you’re speaking to a specialist who understands development and bridging finance inside out.
We work closely with:
- Private and institutional lenders
- Flexible underwriters
- Lawyers and valuers experienced in fast completions
With us, you get:
- Straight answers
- Creative funding structures
- Personal service
- No-nonsense results
Final Thoughts: Don’t Remortgage Blindly
Remortgaging can make sense — but not always.
If you’re sitting on equity and need capital quickly, a second charge bridging loan might be the smarter, faster, cheaper option.
Before you reset your mortgage and pay more than you should, let Sunrise Commercial show you your alternatives.
📞 Call us at 07939 091418
📧 Email: john@sunrisecommercial.co.uk
🌐 Visit: https://www.sunrisecommercial.co.uk/
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