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This is the loan you have compared to the value of your property, displayed as a percentage. Please see the example below…

  • Property value = £200,000
  • Loan amount = £160,000
  • Loan to Value (LTV) = 80%
  • (Loan amount / Property Value) x 100
  • (160,000 / 200,000) x 100 = 80%

When you purchase a property, you are required to put a deposit down yourself. This is just a sum of money that you are personally putting towards the purchase. The more deposit you put in the cheaper the rate as the lender thinks of you as a lower risk.

When you take out a mortgage you get to choose from a competitive set of rates. These will come in many different forms such as fixed, tracker, discount, etc. This is known as an initial benefit period as the rate is much lower than the lenders standard variable rate. Your mortgage term will go may years but your initial benefit period will only last a limited number fo years (typically 2, 3, 5 or 10 years). Because the lender offers a competitive rate, you will usually be tied in with an early repayment charge.

This is a charge that would be incurred if you repay your loan back within the initial benefit period which is a % of the loan. How much will depend on the tyoe of product you have chosen but is 2 – 5 % on average.

Each lender will set their own SVR and as the name suggests the rate may vary month to month. These rates are not competitive and you should never sit on a lenders SVR unless you need some flexibility. If you find yourself on this rate, it’s probably time to remortgage…

A remortgage simply means switching from one lender to another to get a better deal.

This is when you stay with the same lender but you switch to a new product. An example of when this might happen is when you come to the end of your fixed rate deal and switch onto a new fixed rate deal with your existing lender. This may not always be the cheapest option for you so make sure you get advice before doing this.

This is an initial application with a lender to see whether they would consider lending to you based on your income, expenditure and credit score. Please note this is only an initial agreement and not a full mortgage offer. Most estate agents will want to see a copy of this before they accept your offer.

This is a critical part in the house buying process and means that everything is legally binding. It’s when the sellers solicitors exhcnage contracts with the buyers solictirs and the deposit at the bottom of the chain in paid.

This is when everything is complete and you can pick up the keys.

This is referred to by many estate agents when a buyer is at the start of the chain or the end of the chain. Tis is where someone can buy a property but is not dependant on selling a property (i.e. first time buyer, buy to let investor etc) or someone is selling and property and doesn’t need to by on.

This is a group of buyers and sellers in one transaction.

A buy to let is a special type of mortgage that is required if you’re buying a property to rent out.

This is the process referred to when you decide to let out your existing property so that you can buy onwards.

This is the tax you will pay when you buy a property.

This is the terms used for different types of insurances that are used to protect you, your family and your income.

Conveyancers is another word used for solicitors. There is not much difference between the two other than the fact they are governed by different governing bodies.

This is when a lender takes over the possession of your property so they can sell it and get their money back. This will happen if you do not keep up with your mortgage repayments.

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