Secured Loans Done Propperly: Speed, Strategy & Flexibility

PROJECT BACKGROUND:

Our client wanted to raise £200,000 against his residential property to fund a major home refurbishment. The works included a large extension, a new kitchen and bathroom, window replacements, and full decoration – essentially a complete property transformation.

CHALLENGE:

The main challenge was the client’s complex income structure. As a small shareholder in a large recruitment company (holding around 27% of shares), his income didn’t fit neatly into a standard “employed” or “self-employed” category. Many lenders wouldn’t accept this setup, so we needed one that could take a flexible view of his earnings.

Another key factor was that the client already had a residential mortgage with a very high early repayment charge, making a full remortgage uneconomical. Instead, a second charge loan became the most cost-effective and flexible solution.

The client also wanted freedom to make large overpayments without penalties, as his income included bonuses and dividend payments that allowed him to reduce debt in large chunks.

SOLUTION:

We worked with Pepper Money, who accepted an accountant’s reference to verify income. A simple, one-document solution that avoided the need for extensive paperwork.

Key features that made this product ideal included:

• Unlimited overpayments allowed on the fixed-rate period (as long as the balance isn’t fully cleared).
• No valuation costs, thanks to an AVM on the property.
• No consent required from the existing lender (Halifax), keeping the process straightforward.
• Second charge structure, avoiding the huge ERC tied to his first mortgage.

OUTCOME:

With the £200,000 funding in place, our client could complete his dream home refurbishment while maintaining his existing low-rate mortgage.

Key results included:

• £200,000 raised at 58% LTV on a second charge
• Avoided costly ERCs on existing mortgage
• Flexible product allowing large overpayments
• Simple income verification via accountant’s reference
• Fast turnaround – offer to completion in six days

This case shows how Propp’s expertise in navigating complex income and lending structures helps clients access funding quickly – without sacrificing flexibility or incurring unnecessary costs.