Up to 1 in 10 could benefit from a second charge loan

Up to one in 10 remortgage or further advance customers could benefit from taking out a second charge loan, specialist packager V Loans estimates.

The packager cites interest-only customers, those facing steep early repayment charges and those on low-rate mortgages as customers who would benefit from a second charge loan the most.

V Loans managing director Marie Grundy says: “Remortgaging or taking a further advance is not always in the client’s best interest and therefore it’s essential that all options are considered.

“Interest-only customers, those benefiting from lifetime trackers and low fixed rate deals or those who do not want to incur substantial early repayment charges by remortgaging, including landlords who wish to release trapped equity, could all stand to benefit from second charge finance.

“The pending alignment of regulation for first and second charge markets will deliver huge opportunities and innovation to the market allowing advisers to provide better customer outcomes. Intermediaries should seriously consider including second charges within their scope of service ahead of the regulatory changes next year.”

Key Retirement Group bought V Loans, which operates as an appointed representative of Key Retirement Solutions, in September 2014.