The terms below are often used in house buying or mortgage process. You may come across these terms when you are in the process of buying a home so we have provided clear definitions below.
The mortgage loan.
A short-term loan to bridge the period between you buying a new property and selling your previous home.
A person who will arrange a mortgage with a lender. Mortgage brokers must tell you which lenders they use and how much lenders pay them for arranging mortgages.
An extensive survey, carried out by a qualified surveyor, to spot faults and potential problems in the property you are buying.
The amount you have borrowed on the mortgage, and on which interest is charged.
When you become the legal owner of the property.
The legal document which transfers the ownership of the property from the seller to the buyer.
A solicitor or licensed conveyancer who does the legal work involved in selling and buying property.
The legal work involved in selling and buying property.
Credit reference agency
An organisation that keeps details of individuals and their credit histories. Lenders will check with a credit reference agency to see if someone applying for a mortgage has any known credit problems.
The fees, such as stamp duty and Land Registry fees, which you pay to the conveyancer.
Early redemption fee / early repayment charge
The charge some lenders make if a mortgage is paid off early.
The total value of your property, less the amount of the mortgage. For example, if your house is worth £60,000 and you have a mortgage of £50,000, you have equity of £10,000.
Exchange of contracts
The point where the property sale becomes legally binding.
Financial Conduct Authority (FCA)
The Financial Conduct Authority (FCA) is the independent watchdog set up by the government to regulate financial services and protect your rights. The FCA has regulated mortgage sales since 31 October 2004. All lenders must be authorised by the FCA, and brokers must either be authorised directly by the FCA or be agents (known as 'appointed representatives') for other authorised firms. This means that all firms must follow FCA rules when dealing with you. You can check that a mortgage firm is authorised through the FCA website - or by calling the FCA Consumer Helpline (0800 111 6768).
Someone who owns a property and the land it stands on.
A yearly fee leaseholders have to pay to the freeholder or landlord who owns the land the leasehold property is on.
A surveyor's report on a property. This type of survey is less extensive than a full building survey but more extensive than the lender's valuation.
The money you are charged for borrowing.
Land Registry fee
A fee paid to the Land Registry to register ownership of a property.
A legal contract which gives the ownership of a leasehold property to the buyer for a fixed period of time.
Someone who owns a property, but not the land it stands on, for a fixed period of time.
A loan to buy a property. The property acts as security for the loan and so can be repossessed and sold if the mortgage repayments are not made.
Mortgage application fees
These are fees charged by the lender to organise the mortgage for you. These are not usually refunded if you then do not go ahead with the mortgage. Some lenders will only charge such fees for specific mortgage deals.
The legal agreement which gives the lender a legal right to property.
The length of time over which the mortgage will be repaid.
Offer of advance
The formal offer of a mortgage from a lender.
The paying off of a mortgage loan.
When the lender holds back some of the mortgage money until certain repairs have been done, the amount held back is known as a 'retention'.
The property the mortgage is being used to buy is the lender's 'security' for the loan. This means that the lender has rights over the property. If the mortgage repayments are not kept up to date, the lender can repossess the property and sell it to recover the debt.
A government tax on buying properties costing more than £120,000.
Subject to survey and contract
Wording included in any agreement before the exchange of contracts. This wording allows the seller or buyer to withdraw from the property sale.
Life insurance to pay off a mortgage if the borrower dies.
The legal documents which set out the ownership of a property.
The lender's inspection of the property to assess whether it is suitable for a mortgage.
This glossary has been provided courtesy of 'The CML guide to home-buying and selling in England and Wales'
Swift 1st Limited is authorised and regulated by the Financial Conduct Authority.
Swift 1st Limited administers its own regulated mortgage contracts and those of Swift Advances plc on its behalf.
Swift Advances plc and Swift 1st Limited are both registered in England under company numbers 1800474 and 5020019 respectively.