Refused a Second Charge

Answered on 5 September 2018

Can my current mortgage lender refuse a second mortgage on my property?

In short, yes. 

A mortgage lender can and will refuse to allow a second charge to be registered against their security, your property, if they believe that by giving consent it will increase the risk of them making a loss on sale if they repossess the property. This might be because the additional borrowing is, in their opinion, likely to make it harder for you to afford and maintain your mortgage payments or because they believe that there is insufficient equity to cover the existing mortgage, plus any arrears of payments, additional interest charges and legal costs if you are taken to court and they obtain a repossession order.  Either way they are under no obligation to give their approval.

Ask The Mortgage Experts answers are based on the information provided and do not constitute advice under the Financial Services & Markets Act. They reflect the personal views of the authors and do not necessarily represent the views, positions, strategies or opinions of John Charcol. All comments are made in good faith, and John Charcol will not accept liability for them. We recommend you seek professional advice with regard to any of these topics where appropriate.


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