Glossary · UK
What is Further Advance (Mortgage)?
Extra borrowing taken from an existing mortgage lender, on top of the current mortgage balance, without switching lender or waiting for the current deal to end.
Full Definition
A further advance is additional money borrowed from a borrower's existing mortgage lender, secured against the same property, on top of the mortgage they already have. It is typically used to release equity for home improvements, to fund a house purchase deposit for a second property, to consolidate other debts, or to raise capital for any other purpose the lender accepts, without needing to remortgage the whole loan to a new lender or wait until the current fixed or tracker deal ends (which could otherwise trigger an early repayment charge on the existing balance). The further advance is usually arranged as a separate sub-account alongside the original mortgage, often on a different interest rate reflecting current market rates rather than the rate on the original loan, and the lender will reassess affordability and the property's current loan-to-value before agreeing, since the combined borrowing must still fit within its lending criteria. A further advance differs from a product transfer, which simply moves the existing balance onto a new rate with the same lender without adding extra borrowing, and from a remortgage, which involves replacing the whole mortgage, potentially with a different lender.