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Secured Loans
Paragon Bank offers second charge mortgages from £20,000 to £500,000, with terms up to 30 years. Here's what you need to know about eligibility, fees, and how it compares before you apply through a broker.
Paragon Bank secured loans (also called second charge mortgages) range from £20,000 to £500,000, with terms of 5 to 30 years, up to a maximum of 80% combined loan-to-value when added to your existing mortgage. They're available across England, Wales, and mainland Scotland.
Paragon Bank works well for homeowners with a clean credit history who want to borrow larger amounts and spread repayments over a longer term. It's less suitable if you:
Paragon Bank is part of Paragon Banking Group, a FTSE 250 company regulated by the Prudential Regulation Authority and the Financial Conduct Authority. On Trustpilot, it holds a 4 out of 5 rating from more than 10,600 reviews. Speak to an advisor to compare Paragon Bank against other specialist lenders and check whether it's the right fit for your circumstances.
Paragon Bank is a well-established specialist lender offering Paragon Bank secured loans (second charge mortgages) from £20,000 to £500,000, with terms from 5 to 30 years. It's part of Paragon Banking Group, a FTSE 250 company, and works exclusively through brokers rather than accepting applications directly.
In this review, we'll cover Paragon Bank's rates and fees, eligibility criteria, application process, and how it compares to other specialist lenders, so you can decide whether it's right for your circumstances.
Our rating: 4.2 out of 5
Before looking at the specifics, it's worth understanding what a secured loan actually is and how Paragon Bank's version works.
A secured loan, also called a second charge mortgage or homeowner loan, lets you borrow money using your property as security. Unlike a remortgage, where you'd replace your existing mortgage, a secured loan sits alongside it as a separate borrowing arrangement.
Paragon Bank's second charge mortgages work by registering what's known as a second charge on your property, behind your existing mortgage lender. If you couldn't keep up payments and the property had to be sold, your first mortgage would be paid off first, then Paragon Bank would recover what it's owed from any remaining equity. Loan amounts range up to £500,000 and repayment terms run from 5 to 30 years.
This arrangement means you can:
Secured loans can be used for a variety of purposes, such as home improvements or consolidating debts, though Paragon Bank's second charge loans aren't available for any purpose and there are restrictions on how the funds can be used.
The trade-off is that you're putting your home at additional risk. Your home may be repossessed if you do not keep up repayments on your mortgage or any other debt secured on it. That's why affordability assessments are so thorough - lenders like Paragon Bank need to be confident you can manage the payments long-term.
Paragon Bank only accepts applications through brokers, but that's true of most specialist second charge lenders. Working with an advisor means you can compare Paragon Bank against other lenders in the same conversation, rather than approaching each one separately.
Paragon Bank is part of Paragon Banking Group, a FTSE 250 company with roots going back to 1985, when it was established as the National Home Loans Corporation. The bank in its current form launched in 2014.
Paragon Bank's headquarters are in Solihull, West Midlands, and it employs around 1,400 people. While it's primarily known for buy-to-let mortgages, which make up around 85% of its lending by value, its second charge mortgage division offers a range of products to homeowners across England, Wales, and mainland Scotland.
One important thing to know: Paragon Bank doesn't deal directly with customers for secured loans. All applications must go through a broker or intermediary. This isn't unusual for specialist lenders, and it works in your favour - an advisor can compare Paragon Bank's terms against other lenders to find the most suitable option for your circumstances.
Paragon Bank assesses both prime and adverse credit profiles, offering loans across a range of credit scores, though it's not typically the first choice for anyone with significant recent credit problems.
Why consider Paragon Bank
Understanding the full cost of a Paragon Bank secured loan means looking beyond the headline rate. Paragon Bank's second charge mortgage products include options with and without an Early Redemption Charge, giving borrowers flexibility depending on their plans.
Paragon Bank's secured loan rates are variable, meaning they can go up or down over the term of the loan. The rate you're offered depends on several factors:
Because rates change frequently and depend on individual circumstances, speak to an advisor for current figures and a personalised illustration before you decide.
Important: if you add the product fee to your loan rather than paying it upfront, you'll pay interest on it over the full term, which increases the total amount you repay.
When comparing the overall cost of a secured loan, look beyond the monthly payment. A shorter term usually means higher monthly payments but less interest paid overall, while a longer term lowers the monthly payment but increases the total interest charged over the life of the loan. Ask your advisor for a full breakdown of the total amount repayable before you commit.
Compare lenders
Every lender assesses applications differently. An advisor can compare Paragon Bank against a wide range of secured loan lenders to help you find the right fit.
Paragon Bank has specific requirements for secured loan applicants. Here's what you need to know.
Not every property qualifies for a Paragon Bank secured loan. Properties are usually declined if they are:
See the property types Paragon Bank typically accepts below.
Paragon Bank takes a thorough approach to affordability assessment. It considers:
Your existing commitments are factored in, including your first mortgage payment, and Paragon Bank will stress-test your ability to afford payments if rates increase.
This is where Paragon Bank is stricter than some adverse credit specialists. Its lending criteria states:
Paragon Bank can consider applications with some credit issues in the past, but it isn't a specialist adverse credit lender. If you have recent defaults, missed mortgage payments, or have used payday lenders, a more specialist adverse credit lender would likely serve you better.
Eligibility
How it works
Typical timeline: 3-6 weeks from application to funds, depending on complexity. The most common delays are waiting for first mortgage lender consent, valuation issues, or missing documentation.
Initial assessment (day 1-2)
Your advisor gathers information about your property details and estimated value, current mortgage balance and lender, income and employment, monthly outgoings and existing debts, and the purpose of the loan. They then check which lenders are likely to accept your application using a soft search that doesn't affect your credit score.
Full application (day 2-5)
Once you decide to proceed with Paragon Bank, your advisor submits a full application including proof of identity, proof of address, income evidence, bank statements (typically 3 months), and your first mortgage statement. Paragon Bank runs a credit check at this stage, which will appear on your credit file.
Property valuation (day 5-15)
Paragon Bank arranges a valuation of your property. For loans under £200,000 on standard houses, it may use an automated valuation model. For larger loans, flats, or complex cases, a surveyor carries out a full inspection. You'll typically pay the valuation fee upfront, though some advisors may cover this initially.
Underwriting (day 10-20)
Paragon Bank's underwriters verify your income and employment, assess affordability, check the property is acceptable security, and review your credit history in detail. They may come back with questions or requests for additional documents, so responding quickly keeps things moving.
Offer and legal work (day 15-30)
If approved, you'll receive a mortgage offer valid for three months. A solicitor, usually arranged by Paragon Bank, registers the second charge on your property and ensures your first mortgage lender consents to the additional borrowing.
Completion (day 25-45)
Once all legal work is done, funds are released. For debt consolidation, Paragon Bank sends payments directly to your creditors, with any remaining funds coming to you.
To put Paragon Bank in context, here's how it stacks up against other secured loan lenders. Paragon Bank's second charge mortgage products are available with a range of features, including options with and without an Early Redemption Charge.
Paragon Bank is often the better choice if you:
You might find better options elsewhere if you:
An advisor can compare terms across multiple lenders, including Paragon Bank, to find the most suitable match for your circumstances. Since all of these lenders work through intermediaries anyway, using a broker doesn't add an extra step - it's the only way to apply.
Competitive rates for good credit profiles. Paragon Bank's rates are among the more competitive in the specialist lending market. With a solid credit history and reasonable loan-to-value, you may access better terms than many alternatives.
Longer terms available. With terms up to 30 years, you can spread payments to keep monthly costs manageable, though a longer term means paying more interest overall. Ask your advisor to model different term lengths so you can see the trade-off for your loan amount.
Larger loan amounts. The £500,000 maximum means Paragon Bank can accommodate bigger projects, such as major renovations, property purchases, or significant debt consolidation.
Established, regulated lender. As part of a FTSE 250 company with decades of lending experience, Paragon Bank offers stability. It's regulated by the Prudential Regulation Authority and the Financial Conduct Authority, with proper complaints procedures and Financial Services Compensation Scheme protection for its savings products.
Flexible income assessment. Paragon Bank considers regular overtime, bonuses, and commission, plus child benefit. Self-employed borrowers can apply with the right documentation.
No direct applications. You must use a broker, which adds broker fees to your costs. That said, a good advisor can potentially find you better terms elsewhere, so this isn't necessarily a drawback.
Variable rates only. Unlike some competitors offering fixed rates, Paragon Bank secured loans have variable rates, so your payments could increase if Paragon Bank raises its rates.
Stricter credit requirements. Paragon Bank isn't suitable for adverse credit. Its stance on payday loans is particularly strict - any history of using them is likely to mean rejection.
Higher minimum loan. At £20,000 minimum, Paragon Bank won't help if you need a smaller amount. Other lenders start from £10,000.
Limited property types. Ex-local authority flats, non-traditional construction, and various other property types are excluded or restricted. If your property is unusual, check eligibility early.
Paragon Bank has strong overall reviews, though it's worth noting most reviews relate to its savings products rather than secured loans specifically. Paragon Bank's second charge products are available to both existing customers and via intermediaries, providing flexible borrowing secured against property.
Paragon Bank has a 4 out of 5 rating on Trustpilot from more than 10,600 reviews. Common themes include:
Positive feedback:
Negative feedback:
Reviews specifically about Paragon Bank's mortgage products mention business development managers who go the extra mile to help with tricky cases, clear communication during the application process, and professional handling of complex situations.
However, some borrowers have found that underwriting can be thorough to the point of slow, documentation requirements are extensive, and there isn't much flexibility for unusual circumstances.
Based on our experience connecting people with lenders, Paragon Bank is a solid choice for straightforward secured loan applications. It's professional, regulated, and competitive on price for the right borrower.
But it's not the best fit for everyone. If your situation is complicated - adverse credit, an unusual property, or non-standard income - a more specialist lender might be more accommodating, even if rates are higher.
Homeowners with clean credit: if your credit history is solid with no recent defaults, missed payments, or adverse markers, Paragon Bank's competitive terms make it a strong option.
Those borrowing larger amounts: for loans of £50,000 or more, Paragon Bank's terms become more competitive. Its maximum of £500,000 accommodates significant borrowing needs.
Property owners with substantial equity: if your combined loan-to-value (first mortgage plus secured loan) stays under 75%, you'll access better terms. Paragon Bank caps at 80% combined loan-to-value.
Employed borrowers with stable income: regular employment with provable income makes the application straightforward. Self-employed applicants can apply but need more documentation.
Recent credit problems: if you've had defaults, missed payments, or financial difficulties in the past 2-3 years, specialist adverse credit lenders will be more receptive.
Payday loan history: Paragon Bank's criteria specifically states that payday loan users are unlikely to qualify, with no apparent exceptions.
Non-standard properties: if your home is an ex-council flat, non-traditional construction, or has other issues, check eligibility before getting your hopes up.
Small loan needs: needing less than £20,000? Other lenders with lower minimums will be more suitable.
Any secured loan carries risks worth understanding fully before you proceed.
Your home is at risk if you don't keep up repayments, as covered earlier in this guide. This isn't small print - it's the fundamental trade-off of secured lending. If you repeatedly miss payments and can't reach an arrangement with Paragon Bank, it can ultimately pursue repossession through the courts.
Before borrowing, it's worth honestly assessing whether repayments would still be manageable through job loss, illness, rate increases, or unexpected expenses. Building an emergency fund alongside loan repayments provides a safety buffer.
Paragon Bank's secured loans are variable rate only, meaning your payments can increase at any time. It's worth working out what would happen if your rate increased, and whether the higher payments would still be affordable.
The combination of interest, the product fee, and broker, valuation, and legal fees means a Paragon Bank loan costs more than the amount borrowed. For debt consolidation specifically, it's worth considering whether consolidating genuinely saves money or simply spreads the cost over a longer period, while converting unsecured debts into a debt secured against your home.
Applying triggers credit checks that appear on your file. Missed payments during the loan are reported to credit agencies and will damage your score further. On the positive side, maintaining a good payment history can help rebuild your credit over time.
If your circumstances improve and you want to repay early, check for early repayment charges, as these can make switching or settling more expensive. Confirm the terms and any charges with your advisor before committing.
If you're struggling with existing debts or worried about affordability, free and independent guidance is available from MoneyHelper at moneyhelper.org.uk or by calling 0800 138 7777.
Based on our experience connecting people with lenders, Paragon Bank is a solid choice for straightforward secured loan applications. It's professional, regulated, and competitive for the right borrower.
Paragon Bank is worth considering if:
It's worth looking elsewhere if:
Paragon Bank isn't the best fit for everyone. If your situation is complicated - adverse credit, an unusual property, or non-standard income - a more specialist lender might be more accommodating. An advisor can compare Paragon Bank against a wide range of other lenders to help you find the right match for your circumstances.
Overall, we rate Paragon Bank 4.2 out of 5 for secured loans, a strong option for homeowners with good credit borrowing larger amounts, though not necessarily the best fit for every borrower.
Common questions
Yes. Paragon Bank is authorised by the Prudential Regulation Authority and regulated by both the PRA and the Financial Conduct Authority. It's part of Paragon Banking Group PLC, a FTSE 250 listed company. Its savings accounts are protected by the Financial Services Compensation Scheme up to £85,000.
No. Paragon Bank only offers secured loans through intermediaries (brokers). You can't apply directly through its website or by phone. This is common among specialist lenders and means you'll need to work with an advisor who has access to Paragon Bank's products.
Paragon Bank doesn't publish minimum credit scores, but it isn't an adverse credit specialist. You'll generally need a fair to good credit profile. Any history of payday loans makes approval unlikely, and recent defaults, missed payments, or serious credit problems will typically result in rejection.
Typically 3-6 weeks from application to receiving funds. Simple cases with clean credit, standard properties, and quick document provision can complete in around 3 weeks. More complex situations involving property valuations, first lender consent, or additional underwriting can take 6 or more weeks.
No. Paragon Bank's second charge mortgages are variable rate only, which means your payments could increase if it raises its rates. If you want payment certainty, look at lenders such as Shawbrook Bank or United Trust Bank, which offer fixed-rate options.
Up to 80% combined loan-to-value (your first mortgage plus the secured loan). For example, if your property is worth £300,000 and your first mortgage is £150,000 (50% loan-to-value), you could potentially borrow up to £90,000 from Paragon Bank, bringing the combined loan-to-value to 80%. In practice, affordability often limits borrowing before loan-to-value does.
Yes. Debt consolidation is a common use. Paragon Bank pays off secured debts directly to your creditors on your behalf. For other consolidation purposes, funds may be sent to you or paid to creditors depending on the debt type. Be aware that consolidating short-term debt into a longer secured loan means you may pay more interest overall.
Paragon Bank may charge early repayment fees depending on your product terms. These are typically a percentage of the outstanding balance and should be detailed in your mortgage illustration. Always check the specific terms with your advisor before agreeing to the loan if early repayment is a possibility.
Yes. Your existing mortgage lender must agree to Paragon Bank placing a second charge on your property. Most lenders consent routinely, but this step can sometimes cause delays. Your advisor or solicitor will handle this communication.
Yes, but you'll need comprehensive documentation, typically 2-3 years of accounts or SA302 tax calculations plus tax year overviews. Income assessment for self-employed applicants can be more complex, which may affect the maximum you can borrow.
Expect to provide proof of identity (passport or driving licence), proof of address (utility bills or bank statements), income evidence (payslips, P60, or SA302 for self-employed applicants), recent bank statements (usually 3 months), and your current mortgage statement.
It's unlikely. While Paragon Bank may consider some minor historical credit issues, it isn't designed for borrowers with bad credit. If you have recent adverse credit, you'd likely be better served by specialist lenders such as Together Money, Evolution Money, or Optimum Credit, which cater specifically to these circumstances.
This depends on your current mortgage rate. If you locked in a low rate before recent increases, a secured loan from Paragon Bank is likely cheaper than remortgaging to a higher rate. But if your current rate is high and you're out of any early repayment charge period, remortgaging might work out better. An advisor can compare both options for your specific situation.
Paragon Bank's second charge mortgages are for homeowners borrowing against their residential property, where they live. Its buy-to-let mortgages are for landlords purchasing or refinancing rental properties. They're different products, with different criteria and different rates.
What our clients say
Shortly after I spoke with Anna, she was also very helpful and made it effortless and a nice experience.
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Thrilled to share my exceptional experience with Money Saving Advisors. The website made it incredibly simple and easy to connect with an advisor. They helped me find the best deal on my remortgage and secured a very competitive interest rate!
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I have previously declined a loan of the value I needed from various brokers, but this website found me a reputable broker with surprisingly decent rates.
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