Halifax Secured Loans
Compare Halifax Secured Loans
If you have an existing mortgage with Halifax and need to borrow more, you may be able to qualify for “additional borrowing”. This means taking out an extra loan on top of, and separate to, your current mortgage.
This new loan will still be secured against your property and will usually allow you to borrow more than with unsecured borrowing and often over a longer period. You will tend to get a better rate with a secured loan that with unsecured borrowing, although this depends on a number of factors.
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You may also have heard of this type of loan as a “second charge mortgage”.
Second mortgages can be used for a range of different purposes including:
- Second home purchase - e.g. For holiday or investment purposes
- Home improvements - Converting or extending a property to improve your current property?
- For moving house - You may be looking for short term finance up to 12 months to break a mortgage chain or to ensure you don't miss out on a desired property - bridging loans "bridge the gap" between selling and buying a property.
- Investment property - e.g. buy to let or for flipping
- Auction purchase - Buying property at auction or buying land
- Commercial property - e.g. mixed use such as a flat above a shop or where you looking to buy a commercial property
- Buying property abroad - A lot of our clients buy property abroad particularly in Spain and France using UK property as security.
How much you can borrow as an additional secured loan will depend on the balance on your existing mortgage and the market value of your house. Lenders assess this according to a loan-to-value (LTV) ratio.
For example, a lender might be willing to let you borrow up to 75% of the value of your home (as determined by them). This means, if your home is worth £100,000, then the lender would allow you to borrow up to £75,000 in total. If your existing mortgage is for £50,000, then you would be able to borrow an additional £25,000.
Most lenders will not want to let you go above a loan to value of 80% and you will tend to get much better rates with an LTV under 60%.
Benefits of Halifax secured loans
- Borrow up to an LTV ratio of 85% for a repayment loan or 75% for an interest-only loan
- Make fixed monthly repayments
- No arrangement fee
Restrictions on Halifax secured loans
- Minimum loan of £10,000
- You must have had an existing Halifax mortgage for at least 6 months
- Your mortgage payments must be up-to-date for the previous 3 months
- You may have to pay a product fee, depending on exactly which deal you are offered
- Failing to stay on top of your loan payments could negatively affect your credit rating
- If you do not repay your loan, your account may be referred to a county court-appointed bailiff to recover the debt
Get the best deal on secured loans
If you need to borrow in excess of £25,000 our secured loan calculator makes it easy to find the best deals. You can filter the top offers from across the market based on your specific borrowing needs.
Alternatives to secured loans
If you need to borrow less than £10,000, or are interested in other options for borrowing larger amounts, there are some key alternatives to secured loans that you should consider.
If you only need to borrow a relatively small sum, it may be better to simply extend the overdraft on your current account. This can often be a very quick way to get extra credit.
Many credit cards will give you interest free credit for up to 40 months, making this a good option for short and medium term borrowing. After the introductory period, however, interest rates can be high, so ideally you should aim to pay off the debt before the interest-free period ends.
A personal loan is a form of unsecured borrowing which usually involves smaller amounts lent over a shorter period. They can be a fairly quick and straightforward way to access extra funds.
For an idea of how much you could borrow as an unsecured personal loan, take a look at the Post Office loans calculator which offers a representative example.
Instead of taking out an extra loan on top of your existing mortgage, it may be better to combine the two into a single new larger mortgage. Remortgaging can be cheaper than additional borrowing, but if your existing mortgage has a particularly favourable rate you may be better borrowing the extra money separately.
If you only need the extra money temporarily, a bridging loan may be more cost-effective. This involves borrowing money on a short-term basis to fill a gap in funds. Bridging loans are most often used by homeowners you need to buy a new property before their existing one has sold.
Bridging loans tend to come with fairly high interest rates, meaning they can get quite expensive if not paid off promptly.
When borrowing larger amounts, the exactly deal you get can make a big difference to how much you end up repaying. Savvy borrowers need to make sure they know how to find the very best offers from across the market.
Looking to borrow more than £25,000 for property improvements? Fair Mortgages specialist loan advisors can help you get the best deal on your borrowing. Simply call us on 0117 313 7780 or use our quotes form for a quick response.