Annual percentage rate (APR)
The total cost of a loan which includes all costs, interest charges and arrangement fees and is shown as a percentage rate, and easily comparable with mortgage rates.
Expenses that need to be shared (apportioned) between the buyer and the seller of a property e.g. service charges.
The fees charged for arranging a loan on certain products. These are usually applied to loans where a special interest rate applies e.g. fixed or capped rates
Purchased to cover the cost of replacement or repair of a loss or damage to the physical structure(s) you own.
Building survey (or Structural survey)
A full inspection of a property conducted by a chartered surveyor who writes a detailed report, including any property defects. This used to be called a ‘full structural survey’ recommended for any property but especially older properties/ poorly maintained / extensive alterations / extensions etc or for a property you think you will want to extend / adapt etc.
The point at which all transactions concerning the property’s sale are finished and legal transfer of ownership passes to the buyer.
A statement, usually prepared by the solicitor detailing exactly how much the buyer should pay, including the sale price, deposit and other costs, less any reservation fee and/or deposits paid.
Insurance purchased to cover any loss or damage to your possessions within the property.
A legal agreement between the seller and the buyer of a property which binds both parties to complete the transaction.
A legal document that legally transfers ownership to the rights to land or property.
A qualified person who deals with the legal aspects of buying or selling a property. Normally a solicitor or licensed conveyancer.
Term used for the legal work involved in the purchase or sale of a property.
A promise by one person to another (e.g. between the buyer / seller / freeholder) to do something or a restriction not to do something. It binds the property or land, not the individual owner and continues over the land or property even when the current owner sells it to another person.
Legal title documents proving ownership. The deeds are held by the mortgage lender until the mortgage is paid in full.
What is conveyed or sold to the new home owner/leaseholder (usually outline in red on the plan).
A sum of money paid by the buyer on exchange of contracts (usually a percentage of the property value).
Term used to describe a property that stands alone and is separated from others.
Fees paid by the buyer’s solicitor on the buyer’s behalf such as stamp duty, land registry and search fees.
A fee paid by the home owner (seller if property being sold) for the removal of the (Aldwyck’s) charge listed on land registry against their property.
Preliminary, unconfirmed version of the contract.
Engrossed or Engrossment
Getting a document "engrossed" essentially means that you are printing the document in its final form with all the appendices and schedules attached, so that it can be "executed".
The difference between the value of a property and the amount of mortgage owed on the property.
Loan given to help buy a home. It has to be paid when the home is sold and the value paid back relates to the value of the home i.e. if the home rises in value, the loan increases proportionally.
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 an agreed price. The buyer will usually have to pay a percentage of the sale price as a deposit at the same time as contracts are exchanged.
The document is signed and/or witnessed as is appropriate for the document in question.
Fixed equity means that the share offered for sale in a shared ownership property has either a maximum cap the purchaser can staircase up to, or is fixed at the time of purchase and additional shares cannot be purchased in the future. The remaining shares will be retained by the housing association in perpetuity.
A legal term for when a landlord seeks to repossess a home because there are arrears of ground rent and /or service charge; cannot be used for small debts under £350 or unless a debt has been outstanding for more than 3 years.
Opposite to leasehold: it is a technical term giving the owner the right to occupy a property indefinitely and / or unconditional rights, including the right to grant leases and take out mortgages.
Annual charge levied by the freeholder to the leaseholder.
Help to Buy
Various government-sponsored or funded schemes aimed at helping first time buyers and home movers.
Homebuyer’s survey (and valuation)
A survey report carried out by a chartered surveyor to assess the state of a property and its value. The report is not as detailed as a structural survey. It is sometimes called a house or flat buyer’s report.
A developer of homes which could include a private developer, housing associations or other registered providers (RP) of social housing.
Independent Financial Advisor – acting on behalf of the buyer, offering unbiased financial advice. They will research the market and recommend the most suitable mortgage products. They should offer the option of paying by a fee, as well as the option of paying by commission.
Intermediate Housing Market
People looking for a home who are not priority for public sector rented housing (through councils and housing associations) but who cannot afford to buy a home outright or pay private sector rents at the same time as saving the required deposit.
The official body responsible for recording the legal ownership of land.
Land Registry fees
The fee to register ownership of a property with the Land Registry. The fees are set by the Government.
A legal contract by which the freeholder or leasehold owner of a property allows somebody exclusive possession of the property (or part of it) for a specific time in return for a payment, after which point ownership may revert to the freeholder or superior leaseholder.
Denotes that ownership of a property is by way of a lease.
A solicitor or registered conveyancer acting for each of the parties in the purchase of a property.
Listed Building / Property
A building listed as being of special architectural or historic interest, which cannot be demolished or altered without Local Government consent.
Local Authority search
Where the buyer’s solicitor makes an enquiry to the local Council regarding any outstanding enforcement or future development issues which may affect a property or immediate area surrounding a property.
Low cost home ownership (LCHO)
Various government-supported or funded schemes aimed at helping those who cannot afford to buy a home to get onto the housing ladder. LCHO normally refers to buying a part share in a home i.e. shared ownership or through the help of some equity loan schemes.
The cost of repairing and maintaining external or internal communal parts of a building charged to the tenant or leaseholder.
A property with its own front door, arranged over more than one floor in a portion of a larger property.
An agreement by which somebody borrows money from a money-lending organisation such as a bank or building society and it is repayable over a long period of time. The borrower gives that organisation the right to take possession of the property, given as security if the loan is not repaid.
Mortgage arrangement fees
Charges passed on by the lender to the borrower for arranging their loan.
A formal document approving the mortgage the buyer has requested and detailing the terms and conditions that apply.
Mortgage payment protection (MPP)
Insurance designed to pay your monthly mortgage payments if you are unable to work through illness, disability or redundancy. Payments are generally limited to a year.
The standard variable interest rate quoted by lenders which normally varies with the Bank of England base rate. All discounted rates are based on this rate.
The period of time over which (repayment mortgage) or end of which (endowment mortgage) the loan is to be repaid.
The lender of a mortgage – i.e. a bank or building society offering the mortgage.
Income after all taxes have been deducted – often referred to as ’disposable income’.
An industry regulated 10 year insurance scheme covering the structural integrity of a new home. Similar warranties such as ‘Premier’ may be offered instead.
Open market value
The price a property should achieve, agreed between the willing seller and the willing buyer of the property.
The initial enquiries about a property asked of the seller at which the seller must answer honestly before the exchange of contracts.
Public sector tenants
Tenants of a Local Authority (council) or Housing Association, Housing Action Trust, or accommodation provided by the British Armed Forces.
The person who is buying the property.
Registered Provider (RP)
Formally referred to as a ‘housing association’; private organisation whose core business is to provide low-cost social housing. Any trading surplus is used to maintain existing housing and help finance new homes.
Remortgaging is a term to describe changing mortgage provider or borrowing more money to be secured against the property.
When a mortgage lender takes possession of a property due to non-payment of the mortgage secured against it.
Reservation fee (property purchase)
A sum of money paid by the buyer ‘up front’ to reserve the property they wish to purchase. During this ‘reservation’ time the property is withdrawn from sale. For new build properties the reservation fee will be deducted from the price of the home on completion but for re-sales it is offset against the rent account.
Right of first refusal
The right of a company to purchase the property (or something else) before it is made available to others to purchase.
Right to Acquire
Housing Association tenants have the right to purchase their home through the Right to Acquire if they meet the conditions of the scheme – i.e. have been a public sector tenant for 3 years or more and their home must have been built or bought by a Housing Association with public funds from 1 April 1997 onwards (or transferred from a Local Council to a Housing Association after 1 April 1997). Discounts are not the same as Right to Buy.
Right to Buy
Local Authority (LA or council) tenants and tenants of non-charitable Housing Associations (HA) with the ‘Preserved Right to Buy’ following a housing stock transfer from the LA to the HA have the right to purchase their current home at a discount price. Discounts vary. From January 2016 some housing association tenants may register for the Right to Buy their existing property under the Voluntary Right to Buy scheme but tenants will need to contact their housing provider for more details.
An enquiry or request relating to information about a property held by the land registry, or the Local Authority.
Section 106 agreement
Obligations imposed on developers at the planning stage to build ‘affordable’ homes on their housing site
A property which is joined, often down the middle, to one other house.
Service charge (or maintenance charge)
The cost of repairing and maintaining external or internal communal areas of a development and charged to the tenant or leaseholder by the landlord or freeholder owner.
A low cost home ownership scheme, 'part rent, part buy' where purchasers buy a share of a property, usually through a Registered Provider, and pay a subsidised rent on the share they do not own. The deposit required (generally 10% or possibly 5%) is a percentage of the share, not the whole property price.
A professionally qualified legal expert managing the documentation for the sale or purchase of a property.
Process where shared owners who have bought a partial stake in their home increase (or under certain circumstances, decrease) that stake.
Stamp Duty (SDLT)
A government tax payable by the purchaser of a property that varies according to the price paid for the property.
Structural survey (or Building survey)
A full inspection of the property conducted by a chartered surveyor who writes a detailed report, including any property defects. This used to be called a ‘full structural survey’ and is a good idea when buying any home but especially older homes, properties with extensive alterations / extensions, poorly maintained properties or for a property you think you will want to extend or adapt in the future.
Subject to Contract
Words used to indicate an agreement has been reached but is not legally binding.
The actual freeholder of the land a property is built on who is able to grant sub-leases.
A professionally qualified expert who carries out the survey / valuation of a property.
The temporary possession, by an individual with the right to use a flat, building, or a piece of land generally rented from the person / organisation that owns it.
A legal agreement designed to protect the rights of the tenant and the landlord setting out all the terms and conditions of the rental arrangements.
The conditions on which a property is held.
The length of the lease.
A property that forms part of a connected row of houses. The property could be at the end or in the middle.
Documents showing the legal ownership of a property.
The land registry document that transfers the legal ownership of a property.
Legally binding agreement signed from a solicitor to promise to pay a specified sum of money on completion of the sale of the property / land etc.
A basic survey of a property to estimate the value of the property for mortgage purposes. (You will be unable to obtain a mortgage without this).
The person selling their property.