A fixed charge is a form of security that attaches to a specific, identifiable asset—such as a development site or building—and restricts the borrower’s ability to deal with that asset without the lender’s consent. In UK property development finance, fixed charges provide lenders with greater control and priority over secured assets in the event of insolvency. The charge is usually documented in a mortgage deed or debenture and must be registered at Companies House and the Land Registry to take effect. Fixed charges rank ahead of floating charges and unsecured creditors in enforcement
In practice, documentation that contains fixed charges is a key component of the Securities and Collateral package supporting a development facility. Lenders typically require fixed charges over high-value assets such as land, completed units, rental properties or project bank accounts to strengthen their security position and improve recoveries if enforcement becomes necessary. The presence of fixed charges can also influence how disposals, refinancing arrangements and asset management decisions are handled throughout the life of a project, as lender consent is often required. These provisions are frequently reviewed alongside Contains Floating Charge (s), with each type of charge serving a distinct function within the overall security structure.
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