- Adopted road
When a road is adopted it becomes a public road and will be maintained by the relevant authority.
- Adverse credit
Adverse credit generally means a poor credit repayment history that is still visible on a person’s credit report.
- Agreement in Principle
An Agreement in Principle is a letter from your bank or building society that states how much they may be able to lend to you. This is not guaranteed and is not a mortgage offer. Sometimes this is called an Intention to Lend.
- Annual Percentage Rate (APR)
Annual Percentage Rate is the interest rate that is applied for the whole year on a mortgage loan.
- Arrangement fee
A fee a lender charges for setting up your mortgage.
Arrears are when you fall behind on payments to your lender.
- Balance outstanding
The amount remaining on a mortgage loan that needs to be repaid.
- Bank of England Base Rate
This is the official interest rate set by the Bank of England. Banks and building societies then use this rate to set their interest rates on products like mortgages.
- Banker's draft
A banker’s draft is a form of cheque that is written by a bank. You give the bank the money and they write a banker’s draft which is made payable to the person or company you are paying. As the bank draft is written by the bank it will not bounce due to lack of funds.
Bankruptcy is when you cannot repay debts when they are due and you become legally declared bankrupt by a court.
- Bankruptcy search
This is a search carried out in the bankruptcy register, which shows people who have been declared bankrupt.
A borrower is the person who takes out a mortgage loan.
- Building Agreement
This is an agreement between the home buyer and the building contractor who completes the construction work. It is usually used in new build properties.
- Building insurance
Buildings insurance is a policy which covers the physical structure of your home in the event that it is damaged by, for example, flood or fire. Buildings insurance is essential and will be required by your lender if you have a mortgage.
- Building Society
A building society is a financial institution that is owned by and works for its members.
- Building Survey
A Building Survey is the most comprehensive type of survey. It looks at all aspects of the building including potential problems and building defects. This is also known as a Structural Survey.
Capital is a financial term used to describe the amount of wealth in the form of money or other assets.
- Capital and interest mortgage
A capital and interest mortgage means that each payment you make is paying towards both the loan that you borrowed (capital) and the interest that accumulates. This is also called a repayment mortgage.
Cashback is a money back incentive that is offered to a borrower by some banks and building societies for taking out their products.
A chain is when several people are involved in the process of buying and selling houses that are all dependent one another.
- CHAPS transfer
A Clearing House Automated Payment System or CHAPS transfer is a form of electronic payment of funds.
This is usually called a mortgage and it is when your lender has an interest or right in your property until you pay back your mortgage in full.
- Common areas (shared areas)
These are areas that are usually jointly owned by the owners/residents of a housing development or apartment complex.
Completion is the point at which you get the keys to and legally become the owner of your home.
- Completion date
The completion date is the date on which you get the keys to and legally become the owner of your home.
- Contents insurance
Contents insurance is a policy which covers your personal possessions in your home in the event of theft, loss or damage (i.e. fire, water, or accidental damage).
A contract is a legally binding agreement. Breaking a contract can result in significant implications.
Conveyancing is the legal process of buying and selling property.
A covenant is another word for an agreement or a promise between property owners.
- Credit report
A credit report is a record of your financial history and will include things such as – if you have a credit card or loan and whether you have missed any payments.
- Credit score
Your credit score is a number that indicates your ability to pay back money that you borrow. It is used by banks and building societies when assessing whether to grant you a mortgage.
- Deed of Gift
A Deed of Gift is a legal document that is used to transfer property or money to someone without payment.
A deposit is an amount paid to the property seller when a contract to buy the property is signed. It is usually 5-10% of the purchase price.
- Direct debit
A direct debit is a popular way of paying bills such as your mortgage. A regular payment from your bank account is set up by the organisation that is receiving the payment.
Fees paid to your solicitors which the solicitor has to pay to others in connection with your property purchase. Examples include Land Registry fees and Stamp Duty Land Tax.
- Early repayment charge
This is a fee that you may have to pay if you choose to make overpayments on your outstanding mortgage amount or if you pay off your mortgage within a certain set period of time.
A right to use another person’s land for a certain purpose. For example a right to use a laneway, which belongs to someone else, to access your home.
- Endowment policy
This is an insurance policy which is designed to pay out in the event of your death or at the end of a defined period. It is usually used to pay off your mortgage.
- Energy Performance Certificate (EPC)
An EPC gives a property’s energy efficiency rating from A (most efficient) to G (least efficient) and is valid for 10 years.
Equity is the value of your home less any mortgage outstanding.
- Estate agent
An estate agent advertises properties that are available to buy or rent.
Excess is an amount that you will need to pay when you make a claim on an insurance policy.
- Fixed rate mortgage
A fixed rate mortgage means that the interest rate (and therefore your monthly payment) will stay the same for a fixed period of time. After this the interest rate will vary depending on the Lender’s rate at that time. Typically fixed rate mortgage deals last for 2 years, 3 years or 5 years.
- Fixtures, fittings and contents form
A fixtures, fittings and contents form provides a list of the items that are included in the sale of a property, will be removed from the property or are available for a purchaser to buy from a vendor.
Freehold means that you own the property and it is not subject to a lease. You will not have any ground rent to pay.
- Gross income
Your gross income is the amount that you earn before deductions such as tax and national insurance are taken away.
- Ground rent
If your home is leasehold usually you will have to pay a ground rent charge. Ground rent does not generally apply to freehold properties.
A guarantor of a mortgage is someone who agrees to take responsibility for repayments in the event that the borrower cannot make mortgage payments. A guarantor of a rental property is someone who agrees to take responsibility for rent payments in the event that the tenant cannot pay.
- Help to Buy
Help to Buy includes a range of schemes created by government to help people buy their own home. It includes the Help to Buy ISA.
- Holding deposit
A holding deposit is often paid to a builder/developer to reserve a new build property. It is usually about £500.
- Homebuyer Survey
A Homebuyer Survey provides a more in-depth assessment of the condition of the property. It is more detailed than a Mortgage Valuation Survey but not as comprehensive as a full Structural Survey.
- Housing Association
Housing associations together with the NI Housing Executive are the main providers of social and affordable housing in Northern Ireland.
- Independent Financial Advisor (IFA)
Independent financial advisors provide impartial advice and guidance on financial products including mortgages and home insurance. Sometimes they are referred to as ‘brokers’.
- Intention to Lend
An Intention to Lend is a letter from your bank or building society that states how much they may be able to lend to you. This is not guaranteed and is not a mortgage offer. Sometimes this is called an Agreement in Principle.
- Interest-only mortgage
An interest-only mortgage means that you will only pay the interest during the mortgage term and nothing of the actual amount that you have borrowed.
- Joint tenants
If you buy a home jointly with another person, for instance a spouse, civil partner or partner, both of you are responsible for paying the mortgage and both of you will own the whole property. If you are joint tenants and one person dies, the property will automatically go to the other.
- Key Facts Illustration
A Key Facts Illustration (KFI) is a document that tells you information about a particular mortgage. The information is tailored to you.
- Land and Property Services
Land and Property Services (LPS) is a government agency in Northern Ireland that collects, processes and manages land and property information.
- Land certificate
A Land Certificate is a document that shows evidence of ownership of property.
- Land Registry
Land Registry is a department within Land and Property Services (LPS) that records the ownership of land and property in Northern Ireland.
- Land Registry Fee
A Land Registry Fee is payable to register a change in ownership of property. It is paid to Land and Property Services (LPS).
A lease is a contract between the owner of a property (landlord) and someone who rents the property (tenant) for a specified period of time and payment.
Leasehold means that you hold the property under a lease for a period of time and it is subject to a ground rent and to covenants or promises made to your lessor.
A lender is either a bank or building society that provides your mortgage loan.
A person who rents a property from a lessor i.e. a tenant
A person who rents a property to another i.e. a landlord
- Life insurance (or life assurance)
A life insurance policy will pay the insured person(s) a sum of money in the event of illness or death. In the latter case this would be payable to a spouse, partner, dependant or other named beneficiary.
- Loan-to-Value (LTV)
Loan to Value is the split between your mortgage deposit amount and your loan amount. An LTV of 90% means that 90% is your mortgage loan and the other 10% is made up by your deposit.
- Maintenance charge
An amount you will have to pay towards the up-keep of any common areas or shared areas in either a housing development or apartment complex.
- Management company
A management company is responsible for the maintenance and repair of shared/common areas in apartment complexes and some housing developments.
- Market value
Market value is the price which a willing buyer will pay a willing seller for property.
A mortgage is a type of loan that you take out to buy a property.
- Mortgage advisor
A mortgage advisor is a person in a bank or building society that will take you through the mortgage application process and advise you on mortgage products.
- Mortgage deed
A mortgage deed is a legal document that you sign once you’re happy to proceed with your mortgage offer. It will contain the promises you make to the lender to make mortgage payments and other promises in the title.
- Mortgage deposit
A mortgage deposit is an amount that your lender may require you to put down in relation to a property purchase (usually 5-10%) in order to give you a mortgage.
- Mortgage term
Mortgage term is the length of time your mortgage is for. It is usually 25 or 30 years.
- Mortgage valuation
A mortgage valuation is the simplest type of survey. This is carried out by your lender and the purpose is to ensure that the property you are buying is worth the price that you are paying.
- National House Building Council (NHBC)
This is one of the bodies that provides a ten year structural warranty for new build homes.
- Negative equity
Negative equity is when you owe more money to your lender than what your home is currently worth.
- Net income
Your net income is the amount that you earn after deductions – your take home pay.
- Occupier's consent
If someone who is 18 or over is or will be living in your home, your lender will require that they sign an occupier’s consent so that if the home were to be repossessed by the lender, the occupier will leave the property as well and will not claim any interest in the property against the lender.
Buying a property off-plan means that you are agreeing to buy it before it has been constructed.
- Private road
A private road is not adopted by a relevant authority. It can be owned by one or more people who are responsible for its maintenance and repair.
Probate means the process of dealing with a deceased person’s assets including their property.
- Property certificates
These are searches carried out by the local council and the Regional Property Certificate Unit which show planning, building control permissions and other property related matters about your property.
Remortgaging is when you choose to repay your existing mortgage with a new mortgage. Usually this is done to avail of a better mortgage deal and save money. You can also remortgage to borrow additional money against your property.
Redemption means paying off your mortgage.
- Redemption penalty
A redemption penalty is a charge by a lender if you pay off your mortgage earlier than agreed.
- Registered land
Registered land is recorded by Land Registry and is an official record of land and property ownership.
- Registry of Deeds
Registry of Deeds is a register within Land and Property Services (LPS) that records the ownership of property in Northern Ireland.
- Rental deposit
A rental deposit of often required when renting a property from a landlord. It is usually equal to one month’s rent.
- Repayment mortgage
A repayment mortgage means that you are paying back both the loan that you borrowed (capital) and the interest that accumulates. Sometimes this is called a capital and interest mortgage.
Repossession may occur if you fail to keep up the repayments on your mortgage loan. Your lender can take ownership of your home and then sell the property to recover the money that you borrowed.
Retention is when some of the purchase money is held back by a solicitor on completion, until a matter is resolved. An example of this would be a road that has not been fully completed.
- Royal Institution of Chartered Surveyors (RICS)
RICS is the professional body for surveyors.
- Sale agreed
When you place an offer on a property which the seller agrees to, the property becomes sale agreed.
Searches are carried out against buyers and sellers in the bankruptcy and Enforcement of Judgments Office register to check if they are bankrupt or have any judgements against them.
- Service charge
An amount you will have to pay towards the up-keep of any common or shared areas in either a housing development or an apartment complex.
- Shared ownership
Shared ownership is when you buy a part of your home that you can afford and pay rent on the rest.
A solicitor will carry out the legal process of buying and/or selling your home. This process is called conveyancing.
Staircasing is when you buy more shares and own more of your shared ownership home.
- Stamp Duty Land Tax (SDLT)
Stamp Duty Land Tax is a government tax that is paid when you buy a property. There are different rates of SDLT.
- Standing order
A standing order is a regular payment to another person or company that a customer can set up, amend and cancel at any time.
- Structural Survey
A full structural survey is the most comprehensive type of building survey that looks at all aspects of the building including potential problems and building defects.
- Subject to contract
Subject to contract is a term that is used to say that something is not yet legally binding between the parties.
- Tenancy Agreement
A Tenancy Agreement sets out the terms and conditions that you need to adhere to when you rent a property.
- Tenancy Deposit Scheme
A Tenancy Deposit Scheme protects the deposit that you pay to a landlord when renting a property. It ensures that your deposit is returned to you once the tenancy has ended, providing you look after the property and pay your rent.
- Tenants in common
Tenants in common is when each person on the deeds and mortgage owns a defined share of the property. For example, a couple could own 50% each. If they decide to sell the home they would each receive their respective share. If one person dies, then their share falls to be dealt with under the terms of their will or intestacy if they do not leave a will.
- Title deeds
Title deeds are documents that record ownership of a property.
- Transfer of ownership
A transfer of ownership takes place when the name of the registered owner on the title is changed.
Underwriting is the process whereby the final decision is made on whether to approve your mortgage application. The underwriter considers the value of your property, the amount of your mortgage loan and your ability to repay.
- Unregistered land
Unregistered land means property which is recorded in the Registry of Deeds.
- Vacant possession
Vacant possession means that there will be no one living in the property you are buying on completion.
A valuation is an estimation of the current market value of a property.
- Variable rate mortgage
A variable rate mortgage means that the interest rate (and your monthly payment) can change at any time. The rate is set by your lender and can go either up or down in line usually with the base rate set by the Bank of England.
The vendor is the owner/seller of the property that you are buying.