Diagnosis

The second charge won't go on. Where it's actually stuck.

A second-ranking charge is an ordinary piece of lending, but it has more places to fail than a first charge does. The first lender may have a restriction on the property title, a negative pledge in its debenture, or a view on priority it won't put in writing. The asset may not have enough value left. Or the charge was granted and then not registered in time. Each one has a different fix, so the first job is working out which it is.

Tell us what's happening See the charge priority waterfall

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Recognition

Terms agreed, money ready, and the security won't complete

This is a different problem from a lender saying no. The new lender has approved the facility and wants a second charge, over a property, over the business's assets generally, or both, and something between signing and drawdown has stopped it. The solicitors are going back and forth and nobody has told you in plain terms what the blockage is.

The five usual blockages

Where a second charge gets stuck

1. A consent restriction on the property title

If the first lender holds a legal charge over land, its charge often applied for a restriction on the title at the same time. HM Land Registry's practice guide 19 notes that many charges contain an application for a restriction that follows the lines of the standard Form P restriction, calling for the consent of the proprietor of the charge. The operative part of Form P reads that no disposition "is to be registered without a written consent signed by the proprietor for the time being of the charge". A new charge is a disposition, so unless the restriction is worded to leave charges out (the standard form has an optional "(other than a charge)"), the second lender's charge will not be registered until the first lender signs. Check the proprietorship register of the title: the restriction will be there in terms.

2. A negative pledge in the first lender's debenture

For a charge created by an instrument, the Companies House particulars must say whether its terms prohibit or restrict further security ranking equally with or ahead of it (Companies Act 2006, section 859D(2)(c)). If that box is ticked on the existing charge, the second lender's solicitors will want the first lender's consent before completion, whether or not the second charge would rank behind. If the first lender won't give it, this is really a consent refusal, and that page covers the routes.

3. The first lender won't sign a deed of priority

Many second lenders will not advance until ranking, enforcement and payment order are agreed in writing with the first lender. The first lender may be happy for the second charge to exist but not want to sign anything that limits what it can do, or may want terms the second lender won't accept, such as a long standstill before the second lender can enforce. The documents are covered on intercreditor agreements. This is a negotiation between two lenders, and the borrower's main lever is raising it at term-sheet stage, not after.

4. There is not enough value left behind the first charge

A second charge is only worth what is left after the first lender is repaid in full from the same asset. If the first charge secures "all monies", it can secure more than the balance owed today, including facilities that lender makes available later, and how far later advances rank ahead of a second charge is a technical question. Rather than leave it open, many second lenders ask for the first lender's priority to be capped at a stated figure in the deed of priority. The charge priority waterfall shows how recoveries flow down the ranking from your own figures.

5. It was granted, then not registered in time

The statement of particulars has to reach Companies House within 21 days beginning with the day after the charge was created (section 859A(4)). Miss that and the charge is void against a liquidator, an administrator and a creditor of the company, and the money it secured becomes immediately payable (section 859H). The court can extend the period where the failure was accidental, inadvertent or had another sufficient cause, or on other just and equitable grounds (section 859F). A second lender that finds its own charge unregistered after 21 days will usually want a new charge created and registered properly, which reopens every other blockage on this list.

What usually surprises a finance director: the Land Registry restriction and the Companies House registration are separate systems. A charge can be registered at Companies House within the 21 days (Companies Act 2006, section 859A) and still not be registered against the property title (HM Land Registry practice guide 19), because the first lender's consent under the restriction was never obtained. The second lender needs both.

Decision helper

Where it's stuckWhat unblocks itNot this

Land Registry won't register the new charge over the property→The first lender's signed consent under its restriction→Relying on Companies House registration alone

Negative pledge flagged on the existing charge→Written consent, or a waiver for this facility only→Completing and hoping it isn't noticed

The first lender won't sign priority terms→Negotiate the deed of priority, or restructure so one lender holds all the security→The second lender advancing with no ranking agreed

Not enough equity behind the first charge→Smaller facility, other assets, or a cap on the first lender's priority→A higher valuation to make the numbers fit

Charge created but 21 days have passed unregistered→A fresh charge, or a court extension under section 859F→Filing late and treating it as valid

Limits of this page

Which of these applies depends on your title register, the charge particulars at Companies House and the documents themselves, and the solicitors acting on the transaction are the people who can confirm it. What this page gives you is the right question to put to them. Established Finance is an introducer, not a lender, and this is information rather than legal advice.

Talk it through

Need another perspective?

You may already know which facility you think fits. The more valuable question is whether it's actually the right structure for what's happening in the business. We'll review the situation before suggesting possible routes. It costs nothing to have that conversation.

What happens next

A person on our team reads it. No need to know which facility you want first.
If we can help, we may introduce you to a provider and tell you who they are.
No charge and no obligation at any point. You decide whether to go further.

Adam Parker

Founder of Muswell Rose Consulting Ltd, which trades as Established Finance · former Managing Director of Penny, an invoice finance business, working in mortgages, commercial finance and fintech lending since 2010 (career history).

Last reviewed: 25 September 2026

Practical questions

Before you get in touch

Why can't a second charge over our property be registered at the Land Registry?

Usually because the first lender's charge came with a restriction on the title. HM Land Registry's practice guide 19 notes that many charges contain an application for a restriction along the lines of standard Form P, which stops a disposition, and a new charge is a disposition, being registered without a written consent signed by the proprietor of the earlier charge. Some restrictions are worded to leave charges out, so check the exact wording on the title. Where it does catch a new charge, the fix is that lender's signed consent, or repaying and removing its charge.

What happens if a second charge is not registered at Companies House within 21 days?

The period for delivering the statement of particulars is 21 days beginning with the day after the charge was created (Companies Act 2006, section 859A(4)). If it is missed, the charge is void against a liquidator, an administrator and a creditor of the company, and the money it secured becomes immediately payable (section 859H). The court can extend the period on the company's or an interested person's application where the failure was accidental or there is another sufficient or just and equitable reason (section 859F). In practice many lenders prefer to take and register a fresh charge.

Does a second-charge lender need the first lender to agree?

Not always as a matter of law, but usually in practice. Where the first lender's debenture has a negative pledge, or there is a consent restriction on a property title, the charge can't properly be granted or registered without it. Even where neither exists, most second lenders want a deed of priority with the first lender before they advance, so that ranking and enforcement are agreed rather than left to the general priority rules.

How long does it take?

It varies by facility, so there isn't one number that fits every case. Some drawdowns against an existing facility complete within a day or two; arranging something new from scratch usually takes longer. We'll give you a realistic timeline once we understand your situation.

What information do I need?

To start, just a description of what’s actually happening in the business. If it progresses, the provider will ask for the usual things: recent accounts, a sense of turnover and trading history, and details of the specific need.