Glossary definition
Fixed Charge
A form of security that attaches to a specific, identifiable asset — typically the development site — preventing the borrower from dealing with or disposing of that asset without the lender's consent. A first legal charge registered at the Land Registry is the most common form of fixed charge in development finance.
Definition
A form of security that attaches to a specific, identifiable asset — typically the development site — preventing the borrower from dealing with or disposing of that asset without the lender's consent. A first legal charge registered at the Land Registry is the most common form of fixed charge in development finance. Fixed charges rank ahead of floating charges in a liquidation, giving the holder priority over the proceeds of the charged asset.
See also
Closely related terms.
First Charge
A legal charge registered against a property title that gives the holder (typically the senior lender) first priority over all other creditors in the event of a sale or enforcement.
Second Charge
A legal charge registered against a property title that sits behind a first charge, giving the holder (typically a mezzanine lender) a subordinated claim on the security.
Floating Charge
A form of security that hovers over a class of assets that may change from time to time, such as stock, plant, or receivables, crystallising into a fixed charge upon a defined trigger event such as borrower default.
Debenture
A security instrument that creates both a fixed charge over specific assets and a floating charge over a company's remaining assets, giving the lender comprehensive security over the borrower's business.
Further reading
Guides that touch this term.
Guide
Legal Due Diligence in Development Finance: What Solicitors Check
Legal due diligence is the backbone of every development finance transaction. This guide explains what solicitors investigate, common issues that delay completions, and how to prepare your legal pack.
9 min read readReadGuide
The Capital Stack in Property Development: How to Structure Your Funding
A comprehensive guide to understanding and structuring the capital stack in UK property development, from senior debt through mezzanine to equity contributions.
9 min read readReadGuide
What Happens When a Development Loan Defaults? A Step-by-Step Guide
A detailed walkthrough of the development loan default process in the UK, from initial breach notice through to enforcement, and what developers can do at each stage to protect their interests.
12 min read readRead
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