acceptance
When you are offered and accept a mortgage offer from a lender, this is what you need to sign and return.
APR
Stands for ‘Annual Percentage Rate’ related to interest on a loan
Applicant
The term used by a real estate agent to refer to you when you are a potential buyer of a property.
Evaluation
When selling your home, a real estate agent will ‘appraise’ your property to determine its current value.
settlement payment
Some lenders may require this fee to provide or “fix” a loan
assignment
The transfer of property from one person to another. For example, if you buy a rental property, the property will be ‘assigned’ to you through the contract.
basic rate
This is the lowest interest rate a bank will charge when it lends you money and is used as a benchmark to set interest rates for borrowers. This rate is set by the Bank of England and is reviewed several times a year. Lenders will charge borrowers a markup above the base rate.
Bridge Financing/Loan
You may need ‘bridge financing’ if you are buying a new property before selling your current home. This is to ‘close’ the gap before you have sold your property to complete the process of buying your new property before selling your existing home.
runner
This is a person who advises on mortgages and loans, known as a ‘mortgage broker’
limited rate
The stated maximum interest rate you will pay on a mortgage over a set period of time. This means that the interest rate cannot exceed the maximum rate during the specified period of time, usually the first few years of the loan.
string
This refers to a sequence of buyers and sellers. Most people who sell their homes are also buying at the same time. There may be a ‘chain’ of various buyers and sellers, each dependent on each other for the purchase and sale of their new homes. If one buyer or seller walks out, the entire chain can collapse, creating a ripple effect where paperwork for multiple properties is delayed or canceled entirely.
free chain
It is when the owner of the property does not need to sell the property to buy another, so it is offered without a chain.
Collateral
Your home is ‘collateral’ when it is used as collateral that you will repay a loan to your lender. If you don’t keep up with your payments, the lender might sell your house to get back the money they lent you.
Termination
This is the final stage of the property buying process, when the agreed sale price has been paid by the buyer to the seller. Legal ownership has been transferred from the seller to the buyer of the property.
content insurance
This insurance is taken out to cover/protect personal effects found in your home.
contract
This is the agreement that once signed by the buyer and the seller binds both parties to the sale of the property.
Conversion
This can refer to a property in which the loft has been converted to a room, or a house that has been converted to apartments.
transportation
The name of the legal process that transfers ownership of the property from the seller to the buyer.
Covenant
A requirement by law on a property owner to do or not do something with his property.
CAM
Means Checking Account Mortgage
CCJ
This stands for County Court Judgment. If you have a judgment against you for defaulting on a debt, it may mean that you are denied future loans or that you pay a higher interest rate.
Wanderings
Legal documents relating to a property.
Flaw
This is a term used when you don’t do what you agreed to, e.g. miss making a mortgage payment. If you miss your mortgage payments (or default), your home could be repossessed.
delayed completion
Completion typically takes less than 28 days after contract exchange. If it occurs after 28 days, it is called a “late termination.”
Deposit
In mortgage terms, a deposit is the initial lump sum payment that the buyer contributes toward the full purchase price of the property.
Disbursements
This is another word for the legal costs associated with buying a property.
Discount rate
This type of mortgage has a lower interest rate than the lender’s Standard Variable Rate (SVR).
Early Redemption Fee
This is a charge or ‘fee’ payable if you pay off part or all of your mortgage early. This is used to compensate the lender for the interest that would have been paid if the mortgage had been foreclosed during the full agreed period of time.
equitable interest
When a person has some legal rights to a property but does not include the sale of the property.
Equity
This is what you actually own: it’s the difference between the market value of your property and the loan amount you still owe to the lender.
Exchange of Contracts
This is the point at which the buyer and seller are legally obligated to complete the sale.
execution only
A service without advice, just carry out the orders of a client.
fixed rate mortgage
A mortgage that has a ‘fixed’ interest rate for a set period of time.
Installations and accessories
These are items in a house that are included in the sale. For example lighting fixtures, rugs, etc., these need to be agreed/confirmed prior to the sale.
flexible mortgage
As the name suggests, this mortgage is flexible in terms of how you pay off the loan. An example might be allowing you to make overpayments or pay off your mortgage early.
life estate
Full ownership of land and the property on it.
glare
This is when a supplier (seller) accepts an offer but then rejects it in order to accept a higher offer from another buyer.
looking at
This is the opposite of gazumping: when the buyer threatens to pull out just before the contract exchange if the price is not reduced.
Gear
Use of borrowed funds to progress investments. For example, buying a house with a small deposit and the rest with a mortgage, and then selling the property at a higher price, making a profit.
land rent
This is the rent paid annually by the lessee of a property to the owner of the freehold. It is usually paid to the owners of the land on which the property or properties are built.
Guarantor
A person who agrees to guarantee that they will pay a debt or a loan if they default on it.
Home Information Packet (HIP)
Also known as a ‘Seller’s Packet’, this will be a mandatory Survey effective June 1, 2007 to be completed by a home owner or listing agents through a home inspector before a property can be put on the market. open. It is intended to help improve the process of buying and selling a home, it is part of the transfer process and will include detailed information about a property.
IFA
Independent Financial Advisor
Instruction
This is when you give an estate agent ‘Instructions’ or the right to sell or rent your property.
Joint/Multiple Agency
This is when you instruct more than one real estate agent to market your property.
land certificate
The certificate that accredits the ownership of the land issued by the property registry.
Property registration
A government office that stores records of land ownership and any charges such as a mortgage.
To lease
A legal document detailing an agreement made between a property owner and those who occupy their property for a specified period of time. It lists all the conditions that the tenant must meet and what are the responsibilities of the landlord.
Lease
Land or property is ‘lease’ when the owner has to pay the landlord an annual sum of money.
Lender
A person or company that lends money for an agreed period of time. They expect their money back with interest added: their mortgage company is a lender.
LTV
loan to value
maintenance charge
A landlord charges for the annual maintenance of a property, which must be agreed in his contract. This includes maintaining order outside the property and gardening services in common areas.
mig
Mortgage Indemnity Guarantee – an insurance premium that some lenders may require you to take out on certain mortgages.
B>Mortgage
Borrowed money from a lender to buy a property. The borrower agrees to use his property as collateral until the loan is paid off.
mortgage deed
A document that has the details of a mortgage agreement.
Mortgage offer
An offer from a lender detailing the terms and conditions of a loan.
mortgagor
The individual who is borrowing money in order to purchase a property.
negative equity
When you owe more than the market value of your property, or have paid or are paying more than a property is worth.
Offer
An offer, usually below the sales price, that you make for a property.
OMV
Open Market Value: The value a property can achieve when there is a willing buyer and seller.
Redemption
This is the time when you pay your mortgage
registered land
Land including any property on it that is registered in the property registry.
Right of way
Legal access to a property to gain access to your property.
KING
Return on investment: how much you get back for what you invest.
searches
The process of finding out if there are now or planned future unwanted effects on a property.
single agency
When a single (only) real estate agent has been granted the right to sell or lease a property.
Stamp duty
Tax paid to the government on the purchase price of the property.
according to contract
The point at which both parties are free to withdraw from an agreement prior to the exchange of contracts.
poll
A survey is the report produced by a building surveyor for the purpose of determining the value of the property and whether it is structurally sound.
Tenure
A person or persons (may be a business or organization) who have the right to occupy a property under the terms and conditions of a lease.
Tenure
The type of ownership of a property, such as freehold or lease
Title
The legal right to own a property.
Title deeds
A document showing ownership of a property.
under offer
When a property has had an accepted offer but the contracts have not been exchanged.
Classification
A service of an independent real estate agent or expert to determine the value of a property in today’s market.
seller
The person who sells a property.
This is intended as a general guide and should not be viewed as legal advice.