First charge

When a UK lender takes a charge over property or company assets, the charge is registered — at the Land Registry for property, or at Companies House for company assets — and ranks in order of registration. The first charge registered has priority over later charges, which is why a first-charge position is the most secure and therefore typically commands the lowest pricing.

First-charge lenders consent (or refuse to consent) when a borrower wants to add a second-charge facility behind them. They generally allow it provided the combined LTV stays within an agreed ceiling and the second-charge lender enters into a deed of priority that confirms the ranking. This protects the first-charge lender's enforcement rights.

First-charge positions are typically priced lower than equivalent second-charge facilities — sometimes by several percentage points. For UK SME owners, this is one of the simplest cost-saving levers in property finance: if there is capacity to refinance everything onto a single first charge rather than running two separate facilities, the all-in cost is usually meaningfully lower.