Annual percentage rate
(APR) the total cost of a loan, including all costs, interest charges and arrangement fees shown as a percentage rate and easily comparable with mortgage interest rates.
A charge to arrange a loan on certain products. Usually applied to loans where a special interest rate applies e.g. fixed, capped, or discount rates and cash back mortgages.
The transfer of ownership of an insurance policy or lease.
Basic variable mortgage rate
Mortgage lender's standard rate of interest which may be increased or decreased periodically by the lender depending on prevailing economic conditions.
A temporary loan providing financial cover which allows a purchaser to complete on the purchase of a new property before selling the previous property.
A full inspection of the property, conducted by a chartered surveyor, who then writes a detailed report including any property defects. Suitable for any house, particularly older properties and those which have been poorly maintained. Also for properties which have been extensively altered or extended, or any property you may wish to alter or extend.
Buy to let mortgage
A type of mortgage specifically designed for people buying a property with the intention of letting it out.
The amount of the loan on which interest is calculated.
Normally agreed for a fixed period of time, many lenders provide mortgages with an upper limit on the interest rate. Thus if the standard interest rate is lower than the upper limit you will be charged the lower rate, but if the standard variable rate is higher you will be charged at the agreed rate.
The Council of Mortgage Lenders, is the trade association for the
The point at which all transactions concerning the property’s sale are concluded and legal transfer of ownership passes to the buyer.
Insurance to cover loss or damage to your possessions within the property.
A legal agreement between the seller and buyer of a property which binds both parties to complete the transaction.
A qualified individual such as a solicitor or licensed conveyancer who deals with the legal aspects of buying or selling a property.
Traditional term for the legal work involved in the purchase and sale of a property.
Rules and regulations governing the property, contained in its title deeds or lease
Legal title documents proving ownership. The deeds will be held by the mortgage lender.
A sum of money (usually 10%) paid by the buyer on exchange of contracts.
Term used to describe a property that stands alone and is separated from all others.
A newly built residence or an older property which has been refurbished and modernized.
Any disrepair or damage to a rented property.
Fees paid by the buyer's solicitor on the buyer’s behalf such as stamp duty, land registry and search fees.
Paying off a mortgage.
Preliminary, unconfirmed version of the contract
Interest-only repayments combined with monthly premiums into an endowment policy designed to pay off the loan at the end of the term.
The difference between the value of a property and the amount of mortgage owed.
The initial sum you have to pay on an insurance claim.
Fixtures & fittings
All non-structural items included in the purchase of a property.
A flying freehold occurs when part of a freehold property overhangs part of a different freehold property or land and is usually formed when a property is split into two or more freeholds.
Technical word for the ownership of the property, meaning that it belongs to the owner without limitation of time
This is when a seller accepts a higher offer from a third party on a property that they have agreed to sell to someone else, but have not yet exchanged contracts.
When a buyer offers the seller a lower offer just before contracts are about to be exchanged.
The annual charge levied by the freeholder to the leaseholder.
Home Information Packs (HIPS)
A Home Information Pack contains a number of documents that provide buyers with clear information about the property they are proposing to purchase. The introduction of Home Information Packs is being phased in commencing 1st August 2007 with properties that have four or more bedrooms. It is intended that eventually all properties placed on the market will have a Home Information Pack that includes energy performance certificates and recommendations, evidence of title, local land charges register, local enquiries, drainage and water enquiries, required leasehold information and required commonhold information.
Packs may also include home condition reports, evidence of building repair and maintenance carried out after a home condition report, warranties, policies and guarantees for design defect, property completion or any conversion, information on design and building standards, additional search documents relating to or referred to in a local land charges register, local enquiries search or drainage and water search which would be of interest to the buyer.
Homebuyer's survey and valuation (house/flat buyer's report)
This is a survey report, which is not as detailed as a structural survey, carried out by a chartered surveyor to assess the state of a property and its value.
Independent Financial Advisor.
Individual savings account (ISA) mortgage
An interest only mortgage linked to an Individual Savings Account fund, which is designed to pay off the loan at the end of the period.
Interest charges (mortgage)
The charges that are made on a loan, calculated as a percentage of the amount borrowed.
A list which describes the condition of furnishings and contents of a leased property at the commencement of the tenancy in order that any dilapidation during the tenancy can be identified.
A form of ownership for two parties whereby if one of them dies, their share of the property will automatically transfer to the remaining party, giving them full ownership (regardless of the terms of the deceased owner's will.
Land registry fee
Paid to the Land Registry to register ownership of a property.
A legal document by which the freehold (or leasehold) owner of a property lets the premises or a part of it to another party for a specified length of time, after the expiry of which ownership may revert to the freeholder or superior leaseholder.
Denotes that the ownership of the property is by way of a lease.
One officially listed as being of special architectural or historic interest, which cannot be demolished or altered without (local) government consent.
Loan to value (LTV)
The size of the mortgage as a percentage of the property’s value.
Local authority search
Procedure whereby a buyer's solicitor makes an enquiry to the local council regarding any outstanding enforcement or future development issues which might affect the property or immediate area.
Maintenance charge (or service charge)
The cost of repairing and maintaining external or internal communal parts of a building charged to the tenant or leaseholder.
A property arranged over more than one floor (ie: a portion of the house).
A legal document relating to the mortgage lenders interest in the property and containing the terms of the mortgage.
Mortgage payment protection (MPP)
This is an insurance designed to pay your monthly mortgage for a limited period usually a year if you are unable to work through illness, disability or redundancy.
The standard variable interest rate quoted by all mortgage lenders which normally varies with the Bank of England base rate. All discounted rates are based on this mortgage rate.
The period of time over which (repayment mortgage) or at the end of which (endowment mortgage) the loan is to be repaid.
The lender of a mortgage (ie: bank or building society).
When the value of the property falls to less than the outstanding mortgage.
NHBC scheme (National House-Building Council)
A type of building guarantee available on some newly built homes under which defects occurring within a specified time after construction are remedied.
Offer of a loan
A formal document approving the mortgage you have requested and detailing the terms and conditions that will apply.
Open market value
The price a property would achieve when there is a willing buyer and willing seller.
An option on flexible mortgages that allows you to stop making mortgage payments for up to 6 months.
The monthly amount payable for an insurance policy.
Lump sum paid up front as rental for a property.
The sum of the loan on which interest is calculated.
Public liability insurance
Insurance which covers injury or death to anyone on or around your property.
Refinancing a property by either switching a mortgage from one lender to another or by taking out a second mortgage to draw down any equity gained by a rise in value.
When a mortgage is fully repaid.
A mortgage repaid by way of monthly repayments of capital combined with interest.
When the mortgage lender takes possession of your property due to non-payment of the mortgage.
A request or enquiry for information concerning the property held by a local authority or by the land registry.
A property which is joined to one other house.
See Maintenance Charge.
When a seller chooses only one estate agent to sell their home.
Legal expert handling all documentation for the sale or purchase of a property.
A tax paid by purchasers of properties with a value in excess of £125,000, of between 1% and 4% depending on value.
A flat consisting of one main room or open-plan living area incorporating cooking and sleeping facilities and a separate bathroom/shower room.
Subject to Contract
Words to indicate that an agreement is not yet legally binding.
Professionally-qualified expert who carries out the survey.
A temporary possession of a property by a tenant.
A legal agreement designed to protect the rights of the tenant and landlord and setting out all the terms and conditions of the rental arrangements.
A person who has temporary possession of a property.
Tenants in common
A form of ownership by two or more people in which if one of them dies their share of the property forms part of their estate and does not automatically pass to the other(s).
Conditions on which a property is held (ie: length of lease).
A property which forms part of a connected row of houses.
Documents showing the legal ownership of a property.
The land registry document that transfers legal ownership from seller to buyer.
The status of a property for sale, when a seller has accepted an offer from a purchaser but prior to exchange of contracts.
A basic survey of a property to estimate its value for mortgage purposes. Mortgage lenders will insist on this before lending.
Variable base Rate
The basic rate of interest charged on a mortgage. This may change in reaction to market conditions, so your monthly payments can go up or down.
The legal name for a person selling a property
Income from a property calculated as a percentage of its value.