For many people, Right to Buy is still one of the most accessible ways to become a homeowner and over the last five years, nearly 11,500 council homes have been bought through the Right to Buy scheme in England alone, despite a quieter housing market and rising borrowing costs.
More recently, the scheme has moved back into the spotlight. Following the Government’s announcement that Right to Buy discounts would be reduced, local authorities saw a huge rise in applications as tenants rushed to secure the previous, more generous discounts before the changes took effect.
In 2024/25, applications reached more than 63,000, up 236% on the previous year. These were the highest numbers recorded in two decades.
That activity shows there is still strong demand from local authority tenants who want to own their home. However, buying the property is often only the first step, as many new homeowners soon find they need additional borrowing.
Some want to modernise an older property, whilst others need funds for repairs, home improvements or to consolidate existing borrowing.
The challenge is that raising further finance on a recently purchased Right to Buy property is not always straightforward and this is where second charge lending can make a real difference.
One issue borrowers regularly face is that many lenders continue to take the Right to Buy discount into account when assessing equity. That can restrict how much additional borrowing is available during the early years of ownership.
At Norton Home Loans, we take a different view, as after just 12 months, we ignore the original Right to Buy discount when assessing applications.
Instead, we focus on the property’s open market value, and this can make a significant difference to the amount a customer is able to borrow and gives homeowners much earlier access to the equity they have built.
For brokers, this creates an opportunity that is often overlooked, as many advisers will naturally think about remortgaging when a client needs additional funds.
However, if the client has secured a competitive first charge mortgage, moving the whole loan may not make financial sense and they could lose a low fixed rate or face early repayment charges.
A second charge allows them to keep that existing mortgage while raising the additional capital they need and that flexibility is becoming more valuable as borrowers become increasingly focused on protecting the deals they already have.
It also highlights why brokers should not dismiss a case simply because the client bought through Right to Buy recently. Lending criteria differ widely across the market and specialist lenders are often able to look beyond the standard approach.
We regularly see cases where clients have been told they cannot borrow any more, only for a second charge solution to provide exactly what they need.
The recent surge in Right to Buy applications means thousands of new homeowners will enter the market over the coming months and many will eventually look to improve their property or raise capital for other purposes.
When that happens, brokers who understand the opportunities within the second charge market will be in the strongest position to help, because sometimes, the best solution is not replacing the mortgage at all but finding a new secured borrowing route.
