Advance - A loan. The amount borrowed from a lender.
Annual Percentage Rate (APR) - this is the total amount a loan will cost you which will include your fees and interest to be paid. It is given in terms of a percentage. As it stands APR is a useful means of comparing the cost of different mortgages. APR is a higher rate than just the interest of the mortgage.
Applied or Nominal Interest Rate - The interest due on a mortgage is calculated by this rate.
Arrears - These are overdue mortgage payments which have not been paid despite being requested by the mortgage company.
Balance - This is the amount of the original loan still to be paid taking into account any payments that have already been made to the lender.
Bank of England Base Rate - This is the interest rate that the bank of England charges banks for secured overnight lending. This specific rate has a strong influence in the interest rates charged by other lenders.
Buildings Insurance - This is an insurance policy taken out at the time of contract exchange and covers the newly purchased house against damage.
Capital - This is the balance of a mortgage but excludes any outstanding costs and interest.
CAT Standard - Charges, Access and Terms: These standards were set by the Government with mind to helping borrowers and especially first time purchasers. The standards are required to be low, easy and fair.
Closing Administration Charge - When a mortgage is repaid the lender makes this charge to cover the administration costs of the transaction.
Collateral/Security - The borrower puts their property up as collateral or insurance in case of any default on their part. In the case of non repayment the lender can take possession of the property in question.
Completion - This is when all documentation is complete and the property legally becomes that of the purchaser. The mortgage begins at this point in time and this event can also be referred to as “drawdown”.
Contents Insurance - In order to cover the contents of a home such as furniture, personal belongings and appliances against damage of any sort or theft the purchase of contents insurance is required. This may be bought from the mortgage lender or indeed another lender.
Contract - In order to transfer ownership of the property from the vendor to the purchaser this written agreement is made between the two parties involved.
Contract Race - This is used when multiple parties place offers on the same property. The person who is ready to exchange contracts first will win the sale.
Conveyancer - This is a person who prepares deeds for the transference of a property.
Conveyancing - All the legal work that the sale and purchase of a property requires is known as conveyancing.