Refused a Second Charge
Posted on 5 September 2018 by robert
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.
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We recommend you seek professional advice with regard to any of these topics where appropriate.