House Buying Terminology in the UK

Are you looking to buy or sell a property? Confused by all that jargon?

We’ve put together a home-buying glossary that covers everything you need to know (in alphabetical order) so everything will be much easier to understand.

Any time you come across a word you’re not sure about, refer to this list for all the UK house-buying terminology you need to know.

A is for…

  • Agreement in principle (AiP)– A simple way to find out if you could borrow the amount you need to buy a house without a full credit check. It shows you’re a serious buyer, not a timewaster
  • Arrangement fees– A fee charged by your mortgage lender to arrange your loan.
  • Asking price– How much the property owner wants for their property.
  • Auction– Where a property is sold to the highest bidder.

B is for…

  • Balance Outstanding– how much of a loan is outstanding after a certain period of time
  • Bridging Loan- A temporary loan to help you buy a property before yours has been sold
  • Buildings Insurance– Insurance that protects you against the cost of repairing or rebuilding your home following damage by fire, thunder, or lightning.
  • Building Survey– A thorough type of property survey.
  • Buying Agent – These are hired by the buyer and help them find the property that best suits their needs then negotiate the best price and terms.
  • Buy-to-let – When you buy a home and plan to let it to tenants.

C is for…

  • Chain– Where the sale of one home depends on another, for example, one buyer selling their home before they can buy yours.
  • Completion date– When the property legally changes hands from the seller to the buyer
  • Contract– A legal agreement drafted by a solicitor or conveyancer that outlines the terms of sale between buyer and seller.
  • Conditions of Sale– Any terms agreed by the buyer and seller.
  • Contents Insurance– A type of insurance that protects what is inside your home such as possessions and furniture from accidental damage and theft.
  • Conveyancing- The legal process of transferring one property to another, carried out by a solicitor or conveyancer.
  • Conveyancer- An alternative to a solicitor, they are a person who can conduct the conveyancing.
  • Covenant– A condition in the Title Deeds or Lease that the buyer must comply with. This usually applies to all future owners of the property.

D is for…

  • Deeds– Legal documents that prove the legal ownership of a property or land.
  • Deposit– A sum of money that is paid to the buyer to secure the property.
  • Disbursements– These are fees such as Stamp Duty, Land Registry and search fees on top of the standard legal fees charged by a solicitor or conveyancer.
  • Draft contract- This is an early version of the contract that can be checked and edited as required.

E is for…

  • Early repayment charge– If you decide to pay off your mortgage earlier than the agreed repayment period, you could be charged either a percentage or fixed fee of the total loan.
  • Energy Performance Certificate (EPC)– An EPC shows how energy efficient your property is.
  • Equity– The difference between the value of your home and how much you owe on your mortgage.
  • Estate agent- A person or business like Cobb Farr that arranges the selling, renting, buying or management of properties and other buildings.
  • Exchange of contracts- When contracts are signed and the buyer and seller are legally bound to the sale. They cannot change their minds without legal repercussions.

F is for…

  • First-time buyer- A potential house buyer who has never owned a home before.
  • Fixed rate mortgage– Mortgage rates that are fixed for a set period of time.
  • Fixtures & fittings– All non-structural items that are included in the sale of a property.
  • Freehold property- Where both the building and land are owned outright.
  • Full Structural Survey- A full structural survey looks at all the main features of the property including its walls, roof, foundations, plumbing, joinery, electrical wiring, drains and garden to identify any potential issues.

G is for…

  • Gazumping- When you’ve had an offer accepted on a property you want to buy but the seller accepts a higher offer from another buyer.
  • Gazundering- When a buyer lowers his offer just before the contracts are exchanged.
  • Ground rent- An annual fee paid if you own a leasehold property.
  • Guarantor- A person who is responsible for your mortgage payments if you are unable to pay.

H is for…

  • Homebuyers’ Survey- Also known as (Level 2 RICS), this is a popular type of property survey that looks at the property and can include a valuation.
  • Home Buyers’ Protection Insurance- This protects you in case the house purchase should fall through.
  • Home Condition Survey– Another type of extensive property survey.
  • House Price Index- The house price index looks at property prices in the UK.
  • Housing Association- A non-profit body that allows you to buy a percentage of a home and pay rent on the rest.

I is for…

  • Independent Financial Advisor (IFA)- This is an individual who can help you create a financial plan to help ensure you can afford the property and its repayments.
  • Interest-only mortgage- When your monthly repayments only cover the interest, not the loan itself.
  • Instruction- When a property owner instructs an estate agent to market their property.

J is for…

  • Joint ownership- When more than one person owns a property.
  • Joint mortgage- When there’s more than one name on the mortgage.
  • Joint Agency- When two estate agents work together to market a property.

L is for…

  • Land Certificate- This is a certificate that proves ownership of a property.
  • Land Registry- A record of all registered properties in England and Wales.
  • Leasehold – This is where you own the property but not the land on which it is built.
  • Local Authority Search- An application made to a local authority to request details of planning or other matters that could affect the property being sold.

M is for…

  • Mortgage- A long-term loan used to help buy a property.
  • Mortgage deed- A legal document that acknowledges the Mortgage lender’s interest in a property.
  • Mortgage offer- A formal written offer made by a bank or building society to lend an approved amount to purchase a property.
  • Mortgage lender– The financial institution that can lend you the money to purchase a property.
  • Mortgage valuation- This is a survey that assesses whether the home is worth what you are planning to pay for it.

N is for…

  • Negative equity- When the value of the property is less than the amount owed on a mortgage.

O is for…

  • Ownership of a property- The legal right to buy, sell or rent a property.
  • Offer- A bid made by a buyer to purchase a property.
  • Offers over- When offers are invited over the price shown.

P is for…

  • Property- Your home, the property you’re wishing to buy or sell or another dwelling.
  • Property sales- When a home is sold to a buyer.
  • Purchasing a property- The act of buying a home or property.
  • Private Treaty- How most house sales are completed in England and Wales.

R is for…

  • Repayment Mortgage- A mortgage where the monthly repayments include the capital borrowed and the accrued interest.
  • Repossession- When the mortgage payments haven’t been paid and the mortgage lender can sell the property to repay the debt.
  • Retention- When the mortgage lender holds back part of the mortgage advance until specific repairs have been completed on the property.

S is for…

  • Sale agreed- The seller has verbally agreed to the offer made.
  • Sealed bids- Where potential buyers can submit their offer in a sealed envelope by a particular date. The highest bidder is usually the winner.
  • Searches- Checks of local council records for planning applications, motorways, restrictions, and land charges.
  • Solicitor- A legal expert who can handle all documentation for the sale and purchase of a property.
  • Stamp Duty- A tax paid to the government when purchasing a property.
  • Standard variable rate mortgage- A mortgage with interest rates that fluctuate
  • Survey- A report on the condition of a property.

T is for…

  • TA6 form- This is a form with questions for the seller to answer so the buyer can gain important information about the property.
  • Tenure- Whether a property is freehold or leasehold.
  • Tenants- People living at a property that is owned by someone else.
  • Tender- When a seller invites written offers for a property that must be submitted before a closing date.  the seller invites written offers for a property, which have to be received by a set closing date
  • Title- A record of the ownership of a property.
  • Transfer Deeds- The Land Registry document that transfers legal ownership of a property from seller to buyer.

U is for…

  • Under offer- When the seller has accepted an offer, but contracts haven’t yet been exchanged.

V is for…

  • Variable interest rate- An interest rate that fluctuates over time in line with general interest rates
  • Vendor- Another name given to the seller of a property
  • Verbal Offer- An offer given by a potential buyer that isn’t legally binding.

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