Guide to Mortgage Terms

Listed below is a usher to mortgage terms. It is a utile listing of definitions of mortgage terms that may or may not be familiar to you.

Apr

This stand ups for Annual Percentage Rate. It takes into account all fees and other costs in connexion with the mortgage as well as the lenders interest rate.

Advance

This is the existent amount of money that you borrow including any further fees that have got got been added.

Base Rate

The United Kingdom 's core interest rate which is put by the Bank of England.

Bridging Loan

A impermanent loan that enables you to finish the purchase of a new home before completing the sale of your existent property.

Capped Rate

These mortgages have a ceiling above which your payments will not rise.

Completion

The point at which the money to purchase your new home is released to the marketer and ownership is transferred to you.

Conveyance

Legal written document which transfers ownership of unregistered freehold land.

Disbursements

The fees your canvasser have to pay such as as; postage duty, land registry, search fees, etc which will be added to your solicitor's bill.

Discounted Variable Rate

For a set clip time period the interest rate charged will be a set percentage less than the criterion variable rate.

Early Redemption Charge

If you refund your mortgage in full before a specified day of the calendar month you may be asked to pay an early salvation charge.

Equity

The difference between the value of your property and the amount of any outstanding loans secured against it.

Fixed Rate

These mortgages offer a fixed interest rate for a set period of time.

Freehold

The term used to bespeak ownership of property and the land on which it stands.

Interest Only Mortgage

With this type of mortgage, the payments you do each month simply pay the interest on the amount you borrow. At the end of the mortgage term you must pay back the amount you originally borrowed.

Land Registration

This is a record held by hectometer Land Register which names the registered proprietor of a secret plan and any legal charge that may be placed on it.

Lease

A document, which allows ownership of a property for a fixed clip clip period of time and sets out the duties of both landlord and tenant such as as; payment of rent and repairs.

Leasehold

Arrangement between a landlord and tenant where the landlord holds for the tenant to rent the property for a fixed period of time.

Legal Charge

The legal written written written document held by the Land Register that places who have got a claim on your property.

Mortgage

A loan you take out to purchase your home.

Mortgage Deed

Legal document that you must subscribe to state that the lender have a legal charge over your property.

Mortgage Payment Protection Insurance

This is an insurance that volition screen your mortgage payments should you be not able to work owed to an accident, unwellness or involuntary redundancy.

Mortgagor

Person who borrows money to purchase a property.

Mortgagee

Building society, bank or other company which imparts money against the security of a charge over the property purchased.

Offer Letter

This is the functionary missive that the lender directs to you once all the referencing and evaluations have been carried out satisfactorily.

Quotation

Document that illustrates the cost of your mortgage.

Redemption Penalties

These are the charges that some lenders do if you do up one's mind to travel your mortgage.

Repossession

When a borrower neglects to pay back their loan in conformity with its terms and conditions, the lender can exert their legal right to take ownership of the property.

Repayment Mortgage

The payments you make each calendar month will pay off the interest and an component of the capital.

Redemption Figure

This is the amount to be repaid to your existent lender when you travel your mortgage.

Sealing Fee

This is the charge made by some lenders when they let go of the legal charge over your home.

Searches

Enquiries made at the Land Registry, the Land Charges Register and Local Government to guarantee there is nil to cause concern about statute title to the land.

Stamp Duty

A authorities tax on the terms you pay for your home.

Standard Variable Rate

This is the normal variable rate charged by a lender. This rate can travel up or down at any clip at the lender's discretion.

Subject to Contract

A probationary understanding made between buyer and seller, before exchange of contracts, which allows either side to endorse out without penalty.

Term

Length of clip over which your mortgage loan is to be paid.

Title

Legal right to ownership of a property.

Title Deed

Legal written document which transfers ownership of registered land.

Valuation

This is a report produced on behalf of the lender. Lenders usage this to make up one's mind whether they will offer a mortgage on the property.

Valuation Fee

A fee paid by the borrower for the lender's review of the property.

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