Compare long-term secured loans

A long-term secured loan, sometimes called a homeowner loan or second charge mortgage, lets you borrow against the equity in your home and repay it over an extended period, usually between 15 and 30 years.

When you take out a long-term secured loan, the lender registers a legal charge against your property. Your existing mortgage holds the first charge, and the secured loan sits behind it in second position, which is why it's often called a second charge mortgage.

Because the loan is backed by your property, lenders take on less risk than with unsecured lending. This is generally reflected in the amounts you can borrow and the length of the term available, though your rate will still depend on your credit history, income, and how much equity you have. Read our complete guide to secured loans for more detail on how the product works.

How a long term differs from a shorter one

Spreading repayments over a longer period reduces the size of each monthly payment, because you're dividing the amount borrowed across more instalments. The trade-off is that you pay interest for longer, so the total amount of interest paid over the life of the loan is higher than it would be with a shorter term.

This is the fundamental decision with any long-term secured loan: lower monthly payments now, in exchange for a higher total cost over time. There's no single right answer. It depends on what you can comfortably afford each month, how long you're prepared to keep repaying, and how much the total cost matters to you compared with today's affordability.

How much you can borrow with a long-term secured loan depends on three main factors: your available equity, your income, and your credit profile.

Equity-based limits

Most lenders will lend up to 80-85% of your property's value, combining your existing mortgage and the new secured loan. For example, if your property is worth £300,000 and you have a £180,000 mortgage outstanding, your equity is £120,000. At 85% loan-to-value, your maximum combined secured borrowing would be £255,000, of which £180,000 is already accounted for by your mortgage, leaving up to £75,000 available as a secured loan.

Affordability limits

Lenders also assess whether you can comfortably afford the monthly payments alongside your mortgage and other commitments. A longer term generally means a lower monthly payment for the same amount borrowed, which can support a larger loan amount than a shorter term would allow, provided the total cost still makes sense for your circumstances.

Minimum and maximum amounts

Most secured loan lenders set minimum loan amounts of around £10,000 to £15,000, as smaller amounts make the setup costs disproportionately expensive. Maximum amounts typically range from £100,000 up to £500,000 or more, depending on the lender, your equity, and your affordability.

Choosing the right term length is one of the most important decisions you'll make with a secured loan. The pattern is consistent across the market: shorter terms mean higher monthly payments but a lower total cost, while longer terms mean lower monthly payments but a higher total cost.

There's no single right answer. The best term for you depends on what you can comfortably afford each month, how much flexibility you need, and how much you're prepared to pay in total interest over the life of the loan.

When a longer term makes sense

A longer term can make sense if you need the lowest possible monthly payment to keep your budget comfortable, if your income is variable and you want more breathing room, or if you're consolidating several debts and reducing your monthly outgoings matters more than the total cost. You can also make overpayments where your lender allows it, reducing the balance and total interest faster than the contracted term implies, though it's worth checking for any early repayment charges first.

When a shorter term might suit you better

Consider a shorter term instead if your budget can absorb higher monthly payments, if minimising total interest matters more to you, or if you're approaching retirement and want the borrowing cleared while you're still earning. Read our guides to 10-year secured loans and 5-year secured loans if a shorter term might suit your circumstances better, or see how secured loans compare to personal loans for smaller amounts.

Lenders don't set your rate and terms randomly. Several factors combine to determine what you're offered and how much choice you have among lenders.

Credit history and score

Your credit file carries significant weight. Lenders want to see that you've managed borrowing responsibly. Missed payments, defaults, and county court judgments can affect your options, though they don't necessarily rule you out. Credit issues from several years ago generally carry less weight than recent problems, especially if your more recent history is clean.

Loan-to-value ratio

Loan-to-value compares your total secured borrowing, including your mortgage, against your property's current value. The more equity you retain, the more choice of lender you're likely to have. Most mainstream lenders cap their maximum loan-to-value at 75-85%. If you need to borrow above this, your options narrow to specialist lenders.

Income and affordability

Lenders need to confirm you can afford the monthly payments alongside your existing mortgage and other commitments. They'll typically want your total housing costs to stay within a set proportion of your gross income, and they'll stress-test your affordability against the possibility of rates rising if you choose a variable rate. Self-employed applicants usually need two to three years of accounts, though some lenders accept fewer years for established businesses.

Property type and condition

Standard residential properties in reasonable condition qualify for the widest choice of lenders. Non-standard construction, properties above commercial premises, or homes in poor condition can limit your options or mean you need a specialist lender.

Most secured loan providers offer terms between 3 and 30 years, so long-term options are widely available across several categories of lender.

High street banks and building societies

Banks you'll recognise offer secured loans, though they typically reserve their best terms for existing customers with strong credit histories. Acceptance criteria tend to be stricter, and they're often less flexible with complex circumstances.

Specialist lenders

Lenders who focus specifically on second charge lending have built expertise assessing applications that high street banks might decline, including self-employed borrowers, those with complex income, and applicants with past credit issues. Specialist lenders are often more likely to help borrowers who wouldn't be accepted elsewhere, including those covered in our guide to secured loans for bad credit.

Building societies and challenger lenders

Some building societies offer secured loans to existing mortgage customers, with availability varying by region and membership requirements. Newer digital lenders have also entered the market, often with faster, more streamlined application processes for straightforward cases.

Why compare through a broker

Working with a broker means we compare a wide range of lenders to find options that match your circumstances, rather than being limited to what a single lender offers. You complete one application, and we do the comparison work, showing you which lenders are likely to accept you and what a long-term secured loan could realistically look like for your situation.

The rate is only part of the cost. Before committing to a long-term secured loan, look at the fees involved and how they affect the total amount you'll repay.

Arrangement, valuation, and legal fees

Most secured loans involve an arrangement fee charged by the lender, a valuation fee to assess your property, and legal fees to register the charge against your home. Some lenders include these within a single cost, others charge them separately.

Fees added to your loan

Fees are often added to the loan amount rather than paid upfront. This means you pay interest on them for the full length of the term, which on a long-term loan can add a meaningful amount to your total cost. It's worth asking your advisor whether paying fees upfront, where you can afford to, would work out cheaper over the life of the loan.

Early repayment charges

Many secured loans include early repayment charges if you clear the loan before the end of the agreed term, often calculated as a percentage of the outstanding balance and reducing over time. If there's a chance you might repay early, perhaps from an inheritance or a house sale, check the early repayment charge structure before you commit to a long-term secured loan.

Lenders assess long-term secured loan applications against several criteria. Meeting all of them doesn't guarantee approval, but falling short on any one is likely to cause problems.

Basic eligibility

• Aged 18 or over to apply, with most lenders setting a maximum age at the end of the term, typically 75-85
• UK homeowner with sufficient equity remaining after the loan, usually at least 15-20%
• Provable income to demonstrate you can afford the monthly payments
• A UK bank account for repayments

Income requirements

Lenders typically want your total housing costs, including your mortgage and the new loan, to stay within a set proportion of your gross income. Self-employed applicants usually need two to three years of accounts or tax returns, though some specialist lenders accept fewer years for established businesses.

Credit history considerations

No lender expects a perfect credit history, but recent issues generally carry more weight than older ones. Having credit issues in your past doesn't automatically rule out a long-term secured loan. It usually means you'll have fewer lenders to choose from and may need to speak to a specialist lender rather than a high street bank.

Secured borrowing carries risks that are worth understanding fully before you commit to a long-term secured loan.

Your home is at risk

Your home may be repossessed if you do not keep up repayments on your mortgage or any other debt secured on it. This isn't a formality. If you can't maintain payments and can't resolve the situation with your lender, they can start repossession proceedings to recover their money.

You're committed for longer

A long-term secured loan means carrying the risk of repossession for a longer period than a shorter-term loan. Circumstances can change significantly over 20 or 30 years, so it's worth thinking honestly about how you'd cope with the payments if your income changed.

Total cost is higher

The longer the term, the more interest you pay overall, even though your monthly payment is lower. Always ask for the total amount repayable over the full term, not just the monthly figure, so you can compare options properly.

Reduced equity and flexibility

Taking a long-term secured loan reduces your available equity. This can limit your options if you want to remortgage, move house, or borrow again before the loan is repaid. If house prices fall or stay flat during a long term, your equity position may take longer to recover.

If you're struggling financially or worried about keeping up with repayments, free and impartial guidance is available from MoneyHelper on 0800 138 7777.