Understanding Second Charge Bridging Loans

A short-term funding option that lets you access cash quickly without disturbing your main mortgage

When you already have a mortgage on a property but want to release extra funds, a second charge bridging loan can be a smart, flexible solution.

At Credco, we help borrowers and introducers use this type of finance to move quickly and capitalise on new opportunities. Here’s more detail on what they are, how they work, and when they can be the right choice.

What is a second charge bridging loan?

A second charge means the loan is secured behind your existing mortgage (the first charge) on the same property.
A bridging loan is short-term finance, usually used while waiting for a sale, refinance, or another event that clears the loan.

Put simply, a second charge bridging loan allows you to borrow against equity in a property you already own while keeping your current mortgage in place.

A second charge bridge helps you unlock equity quickly while your main mortgage stays untouched.

When can it be used, and why does it work?

These loans are often used when speed and flexibility are more important than low long-term cost.
Typical examples include:

• Funding a time-sensitive purchase or investment
• Refurbishing or improving a property before sale or refinance
• Raising capital for a business or tax payment
• Acting quickly without refinancing an existing low-rate mortgage
• Avoiding early repayment charges on a current mortgage

Why it works:

• You can access funds faster than with most standard mortgage applications
• It keeps the first charge intact
• It uses existing equity without needing to start a full refinance

How a second-charge bridging loan works

1. Assess equity and structure
   The lender checks the available equity after the first mortgage and ensures both loans can coexist safely.
2. Define the term
   Most second charge bridges run for 6 to 24 months and are designed as a short-term solution.
3. Agree on the exit
   Every bridging loan needs a clear repayment route. That could be from a property sale, a refinance, or another source of funds.
4. Complete and draw down
   Once the valuation and documents are in place, funds can be released quickly so you can move on the opportunity.
5. Repay the bridge
   When the exit happens, the first charge lender is repaid first, then the second. Because of this order, second charge lenders take more risk, which is reflected in the cost.

The structure and exit matter more than anything else. They turn a short-term loan into a safe bridge.

When it’s a good fit

Ideal when:

• You have sufficient equity left after the first charge.
• You need fast access to funds.
• You have a clear exit plan within 6 to 24 months.
• You want to avoid refinancing or breaking an existing mortgage.

Less suitable when:

• The equity is too tight or the project is uncertain.
• The exit depends on events outside your control.
• You expect long-term loan pricing.

Use a second charge bridge when flexibility and timing matter more than low rates.

Using a second charge bridge to fund a refurbishment

We worked with a homeowner who had an existing first mortgage and needed short-term funding to complete a refurbishment on their property.

To access the capital quickly without disturbing their main mortgage, they applied for a second charge bridging loan.

Because a second charge was being added, consent from the existing mortgage lender was required. Once this was secured, the bridge completed shortly afterwards, allowing work to begin immediately.

The refurbishment took around three months to complete, after which the client listed the property for sale. Within six months of taking out the bridge, the property sold and the client exited the loan in full through the sale proceeds.

This case highlights how a second charge bridge can help release equity, fund improvements and maintain momentum on a project, all while keeping an existing mortgage in place.

A second charge bridge can unlock capital for short-term projects without interrupting your main mortgage or long-term plans.

Why we recommend them

At Credco, we match each client or introducer to the structure that genuinely works for their goal.
A second charge bridge can be an excellent tool when used for the right reason and with a realistic exit.
We work with lenders who understand this market and can deliver speed without cutting corners, ensuring every deal is built to complete smoothly.

Key takeaways

• A second charge bridging loan is short-term finance secured behind an existing mortgage
• It lets you release equity quickly without disturbing your main loan
• It works best when the goal is clear and the exit plan is realistic
• It’s a flexible option for borrowers and introducers when time and opportunity matter most
• Credco helps ensure the structure is sound, the lender is aligned, and the process runs smoothly from start to finish

It’s not just about unlocking funds. It’s about structuring the right funds, at the right time, for the right outcome.