Jargon Buster

Balanced flue

A pipe or tube fitted to a gas appliance that lets the fumes escape.

Banker's draft

A cheque drawn directly from a bank's funds, and not from an individual's account.
Barge Board

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.

Beneficial owner

The person or people who are entitled to receive the proceeds of a sale.

Bitumen

Similar to asphalt in that it is adhesive and used in sealants and damp-proof courses.

Breach of contract

Where one of the parties bound by a contract fails to keep to the contract's terms and conditions.

Breeze Block

A building block made from concrete and cement.

Bridging Loan

This is a short term loan provided by a bank or building society which covers you if you need to pay for your next home while still waiting for the money to come through from the sale of your current home. If you do require one of these you must ensure that the funds to repay the loan will be in place when the loan period expires.

Buildings Insurance

Insurance required by mortgage lenders to cover damage to your home (eg. In the event of a fire).

Capital and interest mortgage

A mortgage where part of the monthly payment reduces the outstanding mortgage balance and part repays the interests on the loan.

Capped Rate Mortgage

As with all variable rate mortgages the rate follows the lender's SVR up and down. The difference with this type of mortgage is that the rate is guaranteed not to go above the level at which it is 'capped'. This type of mortgage is popular in times of steadily rising interest rates.

Cavity wall

An external wall which has been constructed with a gap of about 50mm (2 inches) between the two leaves of brick or block work.

Cavity wall insulation

Insulating material used to fill the cavity wall - usually polystyrene beads, foam or rockwool.

Cavity wall tie

A strengthening piece of metal fixed between the inner and outer leaves of a cavity wall.

Certificate or report on title

A standard form used by solicitors to request the mortgage or loan funds from the lender.

CCJ

Whenever someone fails to pay for something and is subsequently taken to court the magistrate may issue a County Court Judgement against that individual to pay the outstanding debt. This may well affect your ability to raise finances in the future.

Chain

The situation that occurs when a buyer is reliant upon completion of the sale of his existing property, in order to complete on the purchase of his new property.

Charge

A loan that is secured against land or property.

Check in

The meeting at the beginning of the tenancy when the inventory is checked and the schedule of condition agreed. An independent inventory clerk, or the landlord or his representative usually carries this out.

Check out

The meeting at the end of the tenancy when the inventory is checked and the schedule of condition agreed. An independent inventory clerk, or the landlord or his representative usually carries this out.

Cleared funds

Monies due in a form that does not have to clear through the banking system, usually a banker’s draft, bank automated credit or cash payment.

Client account

A solicitor's bank account where a client's money is held.

Combination boiler

A type of boiler than gives you heating and hot water on demand, without using hot and cold water tanks.

Completion

The final stage of the legal work, when the ownership of the property passes to the buyer.

Completion date

The date that a contract takes effect and property ownership passes from seller to buyer.

Completion statement

A list of all the financial aspects of a transaction. Produced by a solicitor, it sets the costs against the money being received and shows whether money needs to be paid to the client or whether a shortfall needs to be made up before completion.

Contents Insurance

Insurance to cover any loss or damage to your possessions within the property.

Contract

A legal agreement between the seller and buyer of a property which binds both parties to complete the transaction

Contract race

When a seller deals with more than one prospective buyer and exchanges contracts with whichever is ready first.

Completion Date

This is a process unique to buying a house in Scotland that is a bit like finalising the contracts in England but which happens much sooner in the conveyancing process. The two solicitors exchange letters and iron out any of the finer details that were not explicitly mentioned in the original. This may include such things as details of any fixtures and fittings that are actually staying or perhaps a slight alteration to the entry date. Once both parties are agreed on all of the details of the offer which usually does not take long the missives are said to be 'concluded'. This means that both parties have now entered into a legally biding contract from which withdrawal will undoubtedly incur a hefty compensation bill running into many thousands of pounds. Once missives are completed you are also legally responsible for the structure of the property.

Conditions of Sale

This is a legally binding clause in the contract of the property sale. A buyer may insist upon the removal of the ridiculous garish carpets in a house as a condition of the sale or insist that some minor repair work is completex before the transaction is finalised.

Conveyancer

A qualified individual such as a solicitor or licensed conveyancer who deals with the legal aspects of buying or selling a property.

Conveyancing

Traditional term for the legal work involved in the purchase and sale of a property.

Coping Stones

A stone that forms the top of wall or building

Covenant

An agreement contained within a contract or a deed that binds somebody to do something (or not to do something).

Credit reference agency

A company used by the letting agent to verify the creditworthiness of prospective tenants.

Damages

Sometimes referred to as ‘dilapidations’, this is any damage caused to the rented property by the tenant, or resulting from any breach of the terms of the tenancy agreement.

Damp

A structural problem often caused by poor ventilation in a building.

Damp Proof Course

A layer of impervious material (such as mineral felt PVC etc.) incorporated into a wall to prevent dampness rising up the wall or lateral dampness around windows doors etc.

Deed of Covenant

This is a document which confirms that the buyer of a property will comply with the rules and conditions affecting the property which can be found in the Title Deed or Lease.

Deeds

These are the documents which contain all the information about a property such as the owner and the rules affecting the property. These are often held by the mortgage lender to ensure they can take possession of the property should you default on the repayments. Take note of the deed number to speed up your solicitor or conveyancer when buying or selling the property as it can take a lender several weeks to find the correct one.

Deposit

A lump sum paid when contracts are exchanged. It can also refer to the down payment made on a new property in order to reserve it for you.

Detached

Term used to describe a property that stands alone and is separated from all others.

Development

A newly built residence or an older property which has been refurbished and modernised.

Disbursements

Disbursements are expenses that the solicitor incurs on your behalf in association with the legal work (conveyancing) they are performing for you. This will normally include local authority searches land registry fees and various other fees and searches. Expect to pay around £400 including VAT.

Draft Contract

The first stage of the conveyancing process it is a legal document that sets out the terms of the sale. It is drawn up by the seller's solicitor using information from the deeds of the property. However it is not a standard contract and is likely to change or clarify in detail quite considerably. The contract has two parts: Particulars of Sale and Conditions of Sale. The Particulars describe the property what is included and details of the lease or freehold. The Conditions have information about the proposed completion date and any deposit required when contracts are exchanged.

Draft Contract Approved

Once both parties are satisfied that all the details of the draft contract are accurate and your solicitor has made sure that there is nothing that should reasonably either preclude the seller from buying or warrant your withdrawal from the sale then the draft contract is approved and sent to both parties for signature.
Dry Lining

Dry Rot

A fungus that can cause serious damage to a property by attacking structural timbers. Flourishes in moist, damp, poorly ventilated areas.

Due Diligence

This is a process that will be undertaken by a mortgage lender to assure themselves that the risk of lending you the substantial amount of money required to purchase a house is minimised. Involves checking your personal details/ status and that of the property you wish to buy. The term is used in other industries to to indicate a period of research or checks to ensure the suitability of an undertaking of some sort.

Early Redemption Penalties

Charges paid to the lender in compensation for lost interest if you redeem your mortgage ahead of schedule. During a discount period you will be severely penalised if you try to switch to another product or mortgage provider. Penalties can be stepped just like discounts and can be particularly severe within the first year. This is to ensure that the costs that the lender endures in setting up the mortgage are always covered. Penalties can be a fixed sum of money though are often proportion of the loan. With cashback mortgages you often have to repay the amount of money you received as cashback.

Easements

The legal term for the right to use someone else's property such as a shared driveway or a footpath.

Eaves

The under part of a sloping roof which overhangs a wall.

Encroachment

An object such as a fence which belongs to one property which extends onto another.

Encumbrance

A problem with the title to a property that does not affect the transfer of ownership.

Endowment Mortgage

Endowments are unusual products that combine a savings/investment product with an element of life assurance. Their use goes beyond mortgages and they are quite complicated. As with other interest-only mortgages you pay interest on the full amount of the capital for the entire duration of the loan term. The remainder of your monthly payment goes towards a premium for an endowment policy. A portion of this premium is invested and used to pay off the capital at the end of the mortgage term. There is not usually any absolute guarantee that your repayments will actually be enough to reach the level of your loan.

Energy Performance Certificate (EPC)

Forms part of a Home Information Pack. This is a new type of survey that assesses the energy efficiency of a property along with the environmental impact based on its CO2 emissions.

Engrossment

The actual deed or document which is executed (signed) as opposed to a mere draft of it.

Equity

Your equity in the new home is the amount of your deposit. The bigger your deposit the lower the proportion of the loan in comparison to the property value. The less that a lender has to contribute to a property the greater their security and willingness to lend you the money will be. A bigger deposit could also be seen as a stronger commitment to the purchase. Over time a proportion of your repayments will go towards reducing the capital that you owe to the lender so assuming the value of the property is unchanged the amount of equity you own will have risen.

Equity Linked Mortgage

The lender takes ownership of a stake in the equity of the property. This means that they lend you less than the full amount that is required to buy the home. Interest is only charged on the amount that they lend you and not on the full value of the property. When you sell the property the lender receives payment in proportion to the amount of equity that they own and therefore benefits from any increase in the price of the property.

Equity Release

Equity release or home income schemes allow you to generate either a lump some or a regular income in return for allowing the lender to take ownership of a portion of your home. These are often used by people in later stages of life who have paid of all or most of their mortgage and who are looking to raise funds without borrowing money.

Estate Agents Act 1979

A parlimentary act designed to protect consumers from any unscrupulous estate agents. There are no qualifications required to set up in business and so it ensures estate agents can be prosecuted if they do not act lawfully.

Exchange Of Contracts

The point at which signed contracts are physically exchanged, legally committing the buyer and seller to the purchase and sale of a property at the agreed price.

Excess

An amount the policy holder must pay towards each and every incident of loss and damage when making an insurance claim.

Extension

Also referred to as ‘renewal’, this is any extension or continuation of a tenancy after the expiry of the original term.

Fixed Rate Mortgage

A mortgage in which the interest rate is set for an agreed period of time.

Fixtures and Fittings

All the items in the home such as shelves radiators light bulbs light shades and the like. Fixtures are generally those which are screwed or nailed down glued on or have in some other way been made a part of the fabric of the home. Fittings are those things which can easily be removed.

Fixtures and fittings

Fixtures are items that have become part of a building or land and are therefore included in the sale. Fittings are not attached to the building or land and so are not included in the sale unless otherwise agreed. The seller will complete a fixtures and fittings form that will confirm what is included in the sale, what isn't included, and what is for sale separately.

Flashing

Normally metal or cement used to seal a leak in a roof joint which can sometimes be in place from the date of construction to prevent one from happening in the first place.

Flexible Mortgage

An arrangement whereby you can increase or decrease your mortgage repayments.

Flying Freehold

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.

Flue

A pipe or duct attached to an appliance to allow fumes to escape.
Forced Sale Value

Foundations

An underground structure that supports a building or wall.

Freehold

This means that you own the property outright as opposed to leasehold where you own the rights to occupy a property for a specified period of time.

Freeholder

The person or persons who own a property outright.
Frontage

Full disclosure

A requirement that the sellers of a property disclose all known defects to it.

Full status Mortgage

A full status mortgage is for people who wish to make a lender aware of any previous arrears or debt problems they may have had. If they do not make the lender aware of these facts and they are latetr discovered his could lead to all sorts of problems and the borrower could even be forced to sell the home. If you have a bad credit record some lenders will regard lending you money a high-risk activity. Many will not lend you money at all and when you can get a loan you will undoubtedly have to pay a higher rate of interest than you would otherwise.

Full structural Survey

The fullest and most comprehensive of the options open to the property buyer. It involves an extensive investigation of the property and a thorough examination of all the major aspects and minor details that are visible. There is some flexibility as you can request the surveyor to concentrate on specific features of the property. It is most suitable for larger older homes with more potential for problems and those more than 75 years old property over three stories in height buildings of unusual construction (such as thatched timber etc.) or if you plan to extend convert or renovate the property. A full structural survey can cost you anything from £600 to £1000.

Further Advance

You can sometimes have the facility to borrow further funds once you have been paying your mortgage for a set period of time especially with a flexible mortgage. A fee is charged by your lender to cover the cost of assessing the merits of your application.

Gable

The triangular upper portion of a wall at the end of a pitched roof. It typically has straight sides but there are many variations.

Gas safety record

A safety record issued annually by a CORGI registered engineer to ensure all gas appliances, pipe work and flues are safe. It is legal requirement for all landlords to comply with the regulations.

Gazumping

Gazumping is when a seller accepts an offer from one interested party only to accept a higher offer later on from someone else. It can cause financial and mental anguish and is a practice that most buyers would like to see outlawed.

Gazundering

When a buyer forces a seller into accepting a lower offer for their property just before contracts are about to be exchanged by using the threat of pulling out of the purchase completely unless the seller accepts the lower price.

Gearing

The percentage that a company's borrowings represent against shareholders funds (less intangibles) at the end of the last and preceding financial periods.

Ground heave

The swelling of clay subsoil which has absorbed water. This can cause foundations to move upwards.

Ground Rent

This applies only to leasehold properties and is a sum paid annually to the freeholder by the leaseholder.

Guarantor

The guarantor is responsible for payments if you default. If a lender is concerned about your ability to repay your loan they may require you to find a guarantor for the loan.

Guide Price

The guide price is nothing more than an estimate of the eventual sale price at an auction.

Gully

An opening into a drain, normally at ground level, which receives water from downpipes and wastepipes.
Header Tank

Higher Lending Charge

An insurance policy that a mortgage lender may insist upon, to cover the amount of loan above a certain percentage of the property's value. The higher lending charge insurance policy has a one off premium, normally payable by the borrower.

High Street Lenders

Providers of mortgage products who can be broadly split into two groups - the building societies and the banks. Banks are profit-making businesses that return a portion of their profits to shareholders in the way of dividends. Building societies on the other hand are mutually owned organisations which exist not for profit but for the benefit of the members. They claim that this allows them to return profits to their customers in the form of cheaper products.

Home Information Pack (HIP)

A HIP contains five elements, index, searches, registered title documents, Energy Performance Certificate (EPC) and sales statement. If the property is a leasehold, the HIP should also contain a copy of the lease. A HIP must be ordered before a property can be marketed. The estate agent usually does this.

Homebuyers Report

This type of survey is prepared for you and gives details of the basic state of repair of the property. It almost always provides a basic valuation as well. A surveyor will only inspect those areas of the property that are reasonably accessible or visible. They will then write a report on the property.

Homebuyer survey

A homebuyer's survey includes more detail than a mortgage valuation. The report will tell you about any major problems with the building, the general condition of the parts of the building that are reasonably accessible, anything that could be expensive to fix in the future and any suspected problems like timber infestation or damp that might need specialist advice.

Housing act

The 1986 housing act is a wide ranging piece of government legislation that covers many aspects ofbuying selling renting and letting property.

ICE - Independent Case Examiner

An independent referee for people who have a dispute about the deposit at the end of the tenancy.

IFA

In theory these intermediaries should look at the entire financial market before making a selection and offer unbiased advice and access to all suitable financial products. they sometimes still have access to special deals not on offer elsewhere because they may subscribe to a mortgage panel along with other advisers and brokers. Together they convince lenders to provide special packages in return for their continued custom. The only trouble is that they have to deliver a certain level of business over a year to remain on the panel so they may favour some products over others.

Indemnity

Applies to insurance policies and means the insurer will basically make sure you are no better or worse off in the event of a claim taking into account wear and tear.

Indemnity insurance

Insurance against any aspect of a property transaction such as an adverse search result or breach of planning/building regulations. This will not solve any problems but it will provide compensation
Informal Tender

Initial monies

The monies due from the tenant before the tenancy starts, to cover the deposit, first month or quarter's rent, tenancy agreement fee and check in charge.

Interest charges

The charges that a mortgage lender levies on a loan, as a percentage of the amount outstanding.

Interest only mortgage

A mortgage where the monthly payments to the lender cover the interest only. Most borrowers with an interest only mortgage have a savings vehicle to repay the amount of the loan at the end of the mortgage term.

Interest Only Mortgage

With an interest-only mortgage your monthly repayments to the lender consist only of interest on the total loan amount. The interest payments will vary depending on the interest rate being charged by the lender at the time. This type of mortgage involves paying the lowest possible monthly outlay to the lender as no capital is included in the repayment. Instead of repaying the capital regular payments are put aside in a suitable investment or savings plan. This grows cumulatively and assumptions are made regarding its growth in order to calculate a monthly repayment figure. If you are fortunate the investment will accumulate at a higher rate than is required to pay back your loan on time resulting in a cash surplus at the end of the term. This is not always the case however and sometimes there can be a cash deficit at the end of the term.

Inventory

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.

Jamb

Side portion of a doorway or window.

Joint agency

This is where you appoint two agents to sell your property. The commission is often higher as they claim to have only half the chance of earning it.

Joint tenancy

People who have a joint mortgage generally have a joint tenancy. This is therefore the way you would generally own a property with your partner. You both have an equal share in the equity of the property and if you die ownership passes to the other partner. While there is nothing stopping more than two people being joint owners of a home in practice it is very rare.

Joint mortgage

A mortgage obtained by two people. Both are equally liable for the debt on the property.

Joist

Load bearing horizontal structural timber used in flat roof ceiling and floor construction.

K

Land registry

This is a government department which registers and all the details of any land transactions and issues to do with ownership of property in England and Wales.

Land registry certificate

This is a copy of the property entry in the land registry database concerning a property transaction or ownership.

Land registry fees

A charge incurred when buying a home for registering the title of a property under your name. This is usually dealt with by your solicitor / conveyancer.

Landlord

Either the person who owns a property which you are renting and to whom you pay rent or the freeholder of a property for which there is a leasehold tenure.

Lease

The lease is a document which contains the rights and the covenants (rules) on behalf of both the landlord and the tenant which regulate the use of the property.

Leasehold

When you buy a leasehold property essentially you are buying nothing more than the right to occupy a building for a given length of time. You will have to pay ground rent and maintenance in addition to a one-off payment that buys ownership of the lease until sold or it runs out. The amount of alterations you can make to the property varies accordance with the lease and you may well have other conditions imposed upon you by the landlord. As a rule look to buy a lease with over 50 years remaining.

Leaseholder

The person who takes, or is granted a lease.

Leasehold information

Detailed information about the property being sold, provided by the managing agent or freeholder. Includes details of service charges, ground rent and general expenditure, insurance and any maintenance works in hand or proposed.

Lessee

The person to whom a lease is granted.

Lessor

The person who grants a lease.

Let

The process of renting out all or part of your property to someone else.

Liabilities

Basically liabilities are debts that you have and the regular outgoing payments that you make.The reason you must show your bank statements is usually to help the underwriters identify anything in your current expenditure that may impinge upon your ability to repay the loan. They want to know about any other mortgages debts credit cards HP agreements loans overdraft facilities maintenance and court orders. You will normally have to show three to six months worth of bank statements to help demonstrate that the figures you provide them with are accurate.

Life assurance

Life assurance is a type of insurance that provides a fixed amount of money to the policy holder in the event that you die.

Lintel

A horizontal beam or stone bridging an opening usually a door.

Listed Building

A building officially listed as being of special architectural or historic interest, which cannot be demolished or altered without (local) government consent.

Load-bearing walls

A wall which cannot be knocked down as it is supporting the structure of the building.

Loan To Value ratio

A percentage expressing the size of your mortgage to the value of house. For example house value=£100000 mortgage size=£90000. Loan-to-Value=90%.Some mortgages may only be on offer if you are borrowing less than a set proportion of the value of your house. Many lenders offer more favourable deals to customers who are contributing a sizeable deposit themselves.

Local authority searches

A local authority search is a check with the local authorities to establish if any new developments are planned in the vicinity of the property you are buying and to check the water drainage systems and other social infrastructure. This can highlight any public works such as a new motorway waterworks or alterations to road systems as well as anything else that is has had permission to take place immediately adjacent to the property. The local search will also tell you whether there are any planning restrictions that may affect your intentions to renovate or extend the property.

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.

Maisonette

A property arranged over more than one floor (ie: a portion of the house).

Management company

Company formed to manage obligations of a lease such as insurance and repairs.

Managing agents

Firm employed by a landlord or management company to arrange practical maintenance and general management of a building.

Manhole

The ground level access point to a drain, with a removable cover. Also known as an inspection chamber.

Mortgage

The name given to a loan used to buy a property. Usually given at a fairly low rate of interest often cutting your monthly outgoings in comparison to renting while maintaining the same or a higher standard of living. You can take twenty-five years to pay back the money and still end up with a house that you can call your own. It's simple how can you go wrong?

Mortgage application

Forms used to assess whether you meet the lender's underwriting criteria. These criteria are set to ensure that barring any unforeseeable change in circumstances you will be able to support the mortgage and meet the repayments. Questions relate to such things as income & status equity personal details credit history etc.

Mortgage application fee

A charge purely for applying for a mortgage. Paid to the lender upfront at the time of application it is usually between ?100 and ?300.This type of fee is becoming less common than an arrangement fee. As with arrangement fees this type of mortgage fee is usually found with the special deals from lenders possibly to restrict the number of applicants by only attracting serious buyers. Some of the time this fee is refunded on completion of the mortgage.

Mortgage arrears

The amount of back pay you owe your mortgage lender for failing to meet your mortgage requirements.

Mortgage certificate

The first document provided by an mortgage lender which shows any prospective seller that you can actually get a mortgage to cover the purchase price. It also provides a handy reference for some of the key features of your mortgage and what your repayments will be for the introductory offer period if there is one.

Mortgage confirmation

When you get a written confirmation of your offer you usually receive two things. Firstly there will usually be some form of standard covering letter thanking you for your hugely valued business and welcoming you into a family of customers that have their mortgage lender in common. In addition to the letter you will receive a written mortgage confirmation. This will normally set out some of your personal details some facts about the property your salary details your solicitors (if you have appointed them by this stage) and will require a signature.

Mortgage deed

This is the agreement which explains the conditions of the mortgage (loan). It is a document to be signed by all parties to the remortgage on your property and will be sent to HM Land Registry to register the remortgage.

Mortgage Indemnity Guarantee fee

This is insurance for the lender paid by the consumer in a one-off payment on 'high' LTV mortgages. This protects the lender in the event that you default on the loan and the sale of the property is not enough to repay the amount that they are owed. Some lenders will insist you pay this if your mortgage is for as low as 75% of the value of the property but 90% is a more common level. Some lenders will not insist on it regardless of the loan value. You can often add this fee to the loan but be aware that you will then be paying interest on it until the loan is repaid in full.
Mortgage Indemnity Guarantee

Mortgage payment insurance

An insurance policy designed to help cover all or part of a borrower's monthly payment if he or she is unable to work as a result of accident or sickness, resulting in a loss of earnings. The policy may be extended to cover unemployment.

Mortgagee

The lender of a mortgage.

Mortgagor

The mortgagor is another term for the borrower.

Mortgage Rate

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.

Mortgage Term

The period of time over which (repayment mortgage) or at the end of which (endowment mortgage) the loan is to be repaid.

Mortgage valuation

A basic survey of a property to assess its value and suitability for a mortgage. Mortgage lenders will insist on this before a loan is advanced.

Multiple agency

Several agents market your property and the one that sells it gets the commission.

NAEA

This is an association which looks after estate agents and ensures they sign up to the Estate Agents Code of Practice and schemes such as the Ombudsman Scheme.

Negative Equity

When the value of your house falls to less than the mortgage you have taken out to buy it. This means that you are unable to repay your mortgage by selling the property and therefore you are unable to move.

Newell

Either the central pillar of a spiral staircase or the two main supporting posts of a handrail found at the top and bottom of a staircase.

NHBC

A governing body for new homes who will issue a 10 year structural guarantee. Their inspectors will ensure that your new home is built properly and is safe.

Nondisclosure

If you fail to disclose information to your insurer or provide false or incorrect information this is termed nondisclosure and may nullify your policy.

Non-status mortgage

Mainly for people whose income is difficult to assess using the standard method adopted by most conventional mortgage lenders. Bonuses commission and seasonal work can cause income to vary over time or be difficult to guarantee and this may not be considered acceptable in order to get a loan. The main groups of people that opt for self-certification mortgages are: Self-employed and unsalaried company directors Contract workers (increasingly common in technology-based industries) Commission-based workers (often in sales recruitment etc.) People with seasonal earnings. The interest rate you are charged will be higher to compensate the lender for the increased risk.

Notice

An official request to vacate a property. A freeholder or landlord may serve you notice on your home for a variety of reasons including failure to pay rent breach of lease and in the case of rented property simply because they want to sell the property.

Office copies

Certified copies of entries on a register title, provided by the Land Registry.

Open Market Value

The price a property would achieve when there is a willing buyer and willing seller.

Open plan

A property where most rooms or living areas are not separated by walls.

Opening offer

Tthe first price you offer for a property. This is usually below the asking price. Your opening offer will often go a long way towards determining the final selling price. It is therefore common practice for the asking price to be set artificially high in order to encourage an opening offer that is higher than it would be with a lower asking price. Usually both sides are aware that negotiation is something of a game of cat and mouse offer and counter offer.

Oversite

A layer of concrete below a timber ground floor above the external ground level.

Owner-occupier

The buyer has the right to live in the property and to make use of it in any way that is acceptable to the lender.

Outline Planning Permission

This is planning consent which is subject to certain reserved matters, such as design, appearance and sitting of proposed buildings.

Parapet

A low wall usually placed where there's a sudden drop such as at the edge of a bridge or housetop.

Party Wall

This is the wall which separates the properties of two adjoining owners, each of whom have certain rights over that wall.

Payment Break

An option on flexible mortgages that allows you to stop making mortgage payments for up to 6 months.

Penalties

Costs that may be incurred if the borrower repays the loan too early or switches between lenders

Penthouse

A flat usually found at the top of a building and is often associated with the exclusive end of the housing market.

Pied a Terre

A property which is kept for temporary, secondary, or occasional occupation.

Planning permission

Official consent/approval from a Local Authority for works undertaken on a property.

Plasterboard

A layer of plaster sandwiched between heavy paper. Widely used for walls and ceilings.

Pointing

Smooth outer edge of a mortar joint between bricks.

Power of Attorney

A document granting power to some person to act in the name of another. Normally left with a solicitor to enable a purchase to proceed in the absence of either the vendor or purchaser.

Preliminary enquiries

The initial enquiries, about the property being sold, raised by the buyer's conveyancer at the early part of the conveyancing process.

Premium

The monthly amount payable for an insurance policy.

Premium Lease

A lump sum paid up front as rental payment for a property. Most normally used by City firms for corporate lets.

Probate property

A property that is being sold by the executors of an estate due to death.

Property chain

Occurs when a seller needs the sale of their house to occur before they can complete the purchase of another property. This can be the situation for many people in the chain all relying on the sale of their current home. The whole chain can collapse if one buyer is unable to sell their home and a link breaks causing a knock on effect. Always check what your buyer and seller's positions are. First time and cash buyers do not have these problems.
Property Misdescriptions Act 1991
Public Liability Insurance

Purlin

The horizontal beam supporting the rafters in a roof space.

Quote

This is an amount a service provider estimates to be the cost of providing a service based on the available information. These can often vary so it can be worth getting a few quotes to ensure you get the best deal.

Rafter

A sloping roof beam made of timber which forms the main body of the roof.

Rebuild cost

Required for insurance purposes and is the cost of completely rebuilding your home if it is destroyed.

Redemption

This is the right of the mortgagor to recover mortgaged property on repayment of the loan and any interest due. This legally means that once you as the borrower have finished repaying the mortgage you took out the property is yours and the lender has no further claim on it. If you pay of the mortgage ahead of schedule you may face a redemption penalty which compensates the lender for loss of interest.

Redemption penalties

Charges paid to the lender in compensation for lost interest if you redeem your mortgage ahead of schedule. During a discount period you will be severely penalised if you try to switch to another product or mortgage provider. Penalties can be stepped just like discounts and can be particularly severe within the first year. This is to ensure that the costs that the lender endures in setting up the mortgage are always covered. Penalties can be a fixed sum of money though are often proportion of the loan. With cashback mortgages you often have to repay the amount of money you received as cashback.

References

Confirmation of the creditworthiness and suitability of the tenants to undertake the tenancy. This may be obtained from a credit reference company or applied for from an employer, bank and previous landlord.

Rendering

The covering of cement or plaster on a wall.

Rent

The money paid by a tenant to a landlord for the right to occupy a property.

Repayment

Money paid to a lender to partially or fully clear a debt.

Repayment method

How you choose to give back the money borrowed in the form of a mortgage to buy a house.

Repayment mortgage

Each month you will make a repayment to the mortgage lender. Part of this payment will go towards reducing the total amount of capital you owe and part of it will be an interest charge on the remaining balance of the mortgage. Unless interest rates change or your introductory offer period ends you pay the same amount each month. When one of these things does happen repayments are altered so that the loan is still repaid at the end of the specified term.

Repayment term

The period of time over which you will repay your mortgage to the lender.

Repossession

When the mortgage lender takes away a borrower's home because he has fallen too far behind on mortgage repayments.

Remortgage

When an existing mortgage on a property is paid off in full and another mortgage is taken out on the same property.

Restricted covenant

An obligation restricting the use of land which is binding on subsequent owners, for example not allowed to keep animals on the premises, or a house builder may put a covenant on a property forbidding extension without his approval.

Retail Price Index

An index of the average level of prices in the UK. Insurance companies often link contents insurance policies to it.

Retention

This relates to monies withheld by lenders until certain mortgage conditions are met. This will normally relate to repairs or improvements to the property that the lender is insisting on.

RICS

Professional body for surveyors which sets a code of practice for its members.

Rising damp

Capillary action causing damp to rise up a wall from the ground below causing rot in timber and decay to plaster.

Roof cavity

Either a small loft or an inaccessible space that can be insulated to help the building retain heat.

Sale statement

This document tells the buyer the address of the property, who the seller is and whether it is freehold or leasehold.

Schedule of condition

The document drawn up in conjunction with the inventory that details the condition of property at both the check in and check out.

Screed

The final smooth finish of a floor, usually laid in cement or concrete.

Self-certification mortgage

Mainly for people whose income is difficult to assess using the standard method adopted by most conventional mortgage lenders. Bonuses commission and seasonal work can cause income to vary over time or be difficult to guarantee and this may not be considered acceptable in order to get a loan. The main groups of people that opt for self-certification mortgages are: Self-employed and unsalaried company directors Contract workers (increasingly common in technology-based industries) Commission-based workers (often in sales recruitment etc.) People with seasonal earnings. The interest rate you are charged will be higher to compensate the lender for the increased risk.

Sellers leasehold information form

A form filled in by the current property owners often used by some solicitors and conveyancers to check out the term and conditions of the leasehold agreement.

Sellers pack

The government is planning the introduction of a seller's pack which should hopefully speed up the homebuying process and thereby reduce the length of time in which gazumping is possible. This information dossier will become a mandatory requirement of anyone putting his or her home on the market. It will include a basic surveyor's report and the results of local authority searches - both of which are currently the buyer's responsibility.

Sellers position

Circumstances that can enhance or weaken your negotiating position including market conditions length of time property on the market and a need to sell quickly.

Semi-detached

A property which is attached to another one on one side only.

Service charge

This pays for maintenance and insurance of communal areas and is usually only applicable to flats.

Servitudes

The rights of a landowner over the land of another i.e. rights of light etc.

Settlement

Also referred to as 'closing' and occurs when all financial dealings and contractual arrangements are completed by both buyer and seller. All debts are paid and money disbursed and the deed is transferred into the new owner's name.

Soffit

The under-face of eaves balconies etc.

Soil Pipe

The pipe which discharges water from a WC to a sewer. This pipe will extend upwards beyond the roof level in order to vent gases from the sewer.

Sold subject to contract

Very important phrase meaning you have agreed to buy or sell a property but the contracts have not yet been exchanged.

Sole agent

This means an agreement to sell your property through one estate agent only.

Solicitor

Legal professional who is instructed to act on behalf of the buyer in the purchase of a home. They check the legal position of the house carry out a local authority search land registry searches and oversee the smooth exchange of contracts between concerned parties.

Solicitor's fee

Your solicitor will usually charge you a basic fee to cover taking your instructions advising you throughout the course of the sale acting and investigating on your behalf explaining the contract for purchase and completing the matter on your behalf. Though this is rarely charged as a percentage of the property value it can be stepped so that buyers of more expensive properties pay higher fee. If you hunt around you should be able to find a solicitor with a basic charge of as little as £300+ VAT but remember that cheap is not always best.

Specialist conveyancer

Licensed conveyancers offer skills in residential property including the purchase of freehold and leasehold property excellent working knowledge of leases and the transfer of interests in domestic property. You may find that larger law firms have a specialist conveyancing arm that deals specifically with business of this nature.

Stakeholder

When the letting agent holds the deposit in a designated account and at the end of the tenancy deductions can only be made with the written consent of both parties.

Stamp Duty

Stamp duty is a government tax for the privilege of buying a house. Currently the tax is 1% of the property's value for those valued at between ?60000 and ?249000 3% for properties valued between ?250k - ?500k and 5% over ?500k.

Stamp Duty Land Tax

A tax paid by the buyer of a property, where the purchase price exceeds £125,000. The rate of SDLT ranges from 1% to 4% of the purchase price, depending upon the value of the property bought. Rate of SDLT on properties sold ranging £125,000 to £250,000 is 1%. 3% is payable for properties between £250,001 and £500,000 and 4% for properties £500,001 over.

When renting

This is the duty that may be payable on any short term (up to seven years) residential tenancy or lease by the tenant. Whether any SDLT is due to the Inland Revenue will depend on whether the income under a tenancy or lease exceeds the threshold over which SDLT becomes due.

Stud partition

A lightweight wall that has a timber frame and is lined with plasterboard.

Studio Flat

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.

Subsidence

What happens when the ground moves downwards.

Surveyor

Professionally-qualified expert who carries out the survey.

Telegraphic transfer

The electronic transfer of funds from one bank account to another.

Tenant

A person who has a legal right to occupy a property they do not own by signing a contract with the landlord to whom rent is paid.

Tenancy Agreement

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.

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).

Tender

This is an arrangement whereby prospective purchasers are invited to submit sealed bids by a previously stated date and time. The moment the offer is accepted by the seller, the arrangement becomes a legally binding contract.

Tenure

Whether a property is freehold or leasehold.

Term

The time frame for which the lender agrees to provide you with credit.

Term or tenancy

This is the entire period that the tenant remains in occupation of the property, including any extension or renewal period.

Terraced

A house attached to another on both sides.

The Ombudsman for Estate Agents

The OEA is an independent professional body that investigates complaints on behalf of customers, and is answerable to the Trading Standards Department. If using an estate agent to sell your property, it is always worth ensuring that they are members of the Ombudsmen Scheme so you do have some form of redress, should things not go according to plan.

Title

The right to ownership of a property.

Title Deeds

These are the legal documents which prove the ownership of the property and set out details of anything affecting the property such as rights of way and boundaries

Townhouse

A property usually of two or three stories that is connected by a common wall to at least one other residence.

Transfer Deeds

The land registry document that transfers legal ownership from seller to buyer.

Under Offer

The status of a property for sale, when a seller has accepted an offer from a purchaser but prior to exchange of contracts.

Underlease

A further lease of whole or part of a property granted by an existing tenant.

Underpinning

A new foundation is placed beneath the original to strengthen it.

Unmortgagable

A property for which you are unable to find a lender willing to give to a mortgage due to the results or a survey the valuation to price or details of the lease or title deeds.

Utilities

These are companies which provide as gas electricity telephone and the like.

Vacant possession

The previous occupants must vacate the property before you move in this includes any tenants.

Valley gutter

Horizontal or sloping gutter at the internal low intersection between two sloping roofs.

Valuation

This is the estimated price that your property is worth.

Valuation report

This is carried out for the purposes of mortgage and is prepared for the lender. A survey will also help you to find out independently whether the price is reasonable. Your mortgage lender will almost certainly insist on a basic valuation to make sure that the property is worth the amount you are paying for it. They want to ensure that you will be able to sell it again and therefore that it is a safe investment. Although it is often referred to as a survey it doesn't go into nearly as much detail as a homebyuyer or full survey would do.

Variable rate mortgages

As you would expect from the name variable mortgage rates go up and down and generally don't stay at the same level for too long. This is because the interest rate and subsequent level of repayment varies with the lender's interest rate. This is usually derived from Bank of England base rate or some other index. One such index is the banks' base rate - an average of the rates of several leading lenders.

Vendor

The person who is selling the property.

Viewing

Arrangement for potential buyers to see a seller's property and usually through an estate agent in advance. In most cases the owner of the property will show you around their home.

Wet rot

Decay of timber due to damp conditions but not as serious as dry rot.

Woodworm

A large beetle which infests timber and can cause severe structural damage. If suspected seek professional advice.

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Yield

Income from a property calculated as a percentage of it's value.

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