Mortgage Loan Terms

Mortgages jargon | Mortgages for companies

Do you need help interpreting mortgage slang terms? These A through Z mortgage terms will help you better grasp the technical terminology used in the mortgage business. We may have provided further information about purchases specifically for renting mortgage lingo. It is the lender's responsibility to inform you of the annual percentage rate of charge before concluding a credit contract.

It is the amount calculated by a creditor to establish the mortgage for you. A person is in default if he has failed to make payment that he should have made to his mortgage or other debts. Company that has the necessary permits from the FCA (or its successors ) to perform controlled functions, such as brokering mortgage loans or insurances.

At the time of requesting a purchase to rent a mortgage on a particular real estate, creditors will want to be informed about all other real estate that the lessor has. BBR: The Bank Base Interest Rates (now officially referred to as Bank Rates) are revised each months and are the interest rates fixed by the Bank of England. Their mortgage interest rates can be coupled to BBR according to mortgage types.

That is the charge that a mortgage agent charges for obtaining and handling the mortgage that is most suitable for you. Mortgage BTL: Buy to Let Mortgage is a special loan provided specifically for the purchase of a home for rent to a tenant. Capital and interest mortgage:

Known also as a repayment mortgage. Mortgage at the most: a mortgage: Such a mortgage can go up and down with the interest rates; however, it has a firm maximal interest rates (capped interest rate) which it will not pass. They only apply to certain types of mortgage and can be a set amount or a certain proportion of the mortgage.

The term used to describe the end phase of the purchase of a real estate or the rescheduling of a loan to a real estate. It is the juridical procedure for the purchase/sale of real estate. CML was an inter-branch organisation which represents mortgage creditors in the United Kingdom. It is the review that is included in your finance histories when you request a mortgage.

This is a process in which a number of different types of loan can be paid back by different creditors from the revenue of a new loan. Policy decision: The determination of whether a creditor is willing to grant a loan to a prospective debtor if he is happy with the collateral provided.

DIP: This is the concept that is used to describe the procedure that leads the creditor to make his basic mortgage will. It is a guarantee to lower the interest on your mortgage compared to BBR, SVR or LIBOR. EEA: Early repayment penalty (also known as early repayment penalty) is a fee that can be charged under the terms of your mortgage if you pay early or before a certain date.

It is the amount of the loan that differs from the value of the real estate. EPC may also be necessary if a characteristic is modified in a particular way. Initial charge: First ( or most important ) mortgage on a real estate. Mortgage at a fixed interest rate: E.g. the lending institution can adjust the instalment at 5. 75% for the first three years.

At the end of this interest fixing term, the interest paid by you changes to an interest bound to BBR, LIBOR or SVR. This is a circumstance in which the landlord has both the real estate and the plot on which he is located. An individual who holds the title to a real estate. Real estate is an apartment building if you rent (or are planning to rent) to at least three lessees who make up more than one house and are ( or will be) sharing toilets, bathrooms or cooking equipment.

Just an interest rate mortgage: In a pure interest mortgage, your monetary repayments are just the interest on the mortgage loan. That means that your montly payment does NOT decrease the real loan amount. Therefore, it is important to have a different capital expenditure schedule so that you can disburse the mortgage at the end of the loan term.

An individual or legal body that leases or intends to lease a foreign privately leased real estate object. Tenants can also be landlords if they rent out part or all of the real estate that they rent themselves. This is the term used when you own/purchase the real estate, but not the plot on which it is located.

At the end of a specified number of years, the rental agreement must be repurchased or renewed, otherwise the real estate will ultimately be returned to the owner. It is the unit that borrows the funds for the mortgage, e.g. a savings and loan association or savings institution. Loan to Value is the amount of the loan, expressed as a percent of the value of the real estate.

E.g. if a piece of real estate is appraised at £100,000 and the mortgage you take is for £65,000, then the LTV is 65%. LIBOR: The London InterBank offered interest is the interest at which the creditors mutually loan and loan one another funds. The interest can be the interest on which your mortgage is built (instead of the BBR or SVR).

The MMixed Use property: Hypothecary: It is a loan that is used to purchase a real estate. Your real estate serves as collateral for repaying the loan. So if you fall behind with the loan, your real estate can be taken back. Mortgage can be taken out on a wide range of real estate, such as apartments, homes, shops, office space and hotel accommodation.

Mortgage creditor: Hypothecary: Mortgage brokers can help you safe your precious investment because they have considerable insight into the markets, expertise and relations with mortgage providers. If the value of the real estate is lower than the value of the mortgage due, this will happen. Foreign private leased properties:

Every piece of non-apartment real estate leased separately, i.e. a house or part of a house that is or will be used as a seperate apartment. Real estate can be an entire structure or a single entity within a structure. The significance of foreign real estate leased illegally is determined by ordinance 20(1) as specified in § 42(1)(b) of the Energy Act 2011.

In simple terms, it is the real estate that the lessee leases from the lessor. Private / Home Mortgage: It is a mortgage issued on a piece of real estate where you will live, for example if you buy your own house. It is a mortgage that allows you to mortgage another home without penalties, even if there are repayments.

"Recipients with four or more different mortgage-backed buy-to-lease objects, either together or separated, in aggregate". It is used by creditors to evaluate the borrower's capacity to finance the loan proposal. Redemption mortgage: This is a mortgage that asks you to repay the loan and the interest simultaneously for the entire duration of the mortgage.

This is the procedure whereby a creditor asserts his right to take over and dispose of a real estate if the debtor does not make mortgage payment at maturity. Reverse rate: It is the interest on which your mortgage falls back at the end of each stimulus or at the end of a fix interest term. You can, for example, have a three-year fixed-rate mortgage of 5.75%.

By the end of the three years, the mortgage interest rates may have changed to 6.4%; therefore, the reverse would be 6.4%. This is the control that your lawyer performs when buying a new home. You will be on the lookout for anything that may impact your real estate. An example is when design requests have been made on that plot or area; or when the area is at risk of being flooded; or when there is a story of sinking.

They are no longer generally available in the UK mortgage markets. Punch tax: More precisely, as punch real estate taxes, this is a levy that is imposed on real estate sales. Only £125,000 or more of real estate is eligible and is charged as a percent of the real estate value. It is a comprehensive investigation of the real estate's real estate physics/structures.

Strech loan: Loan that is larger than the borrower's loanable asset. Subprime consumers are often seen as a higher credit provider exposure and may therefore receive higher interest payments. It is part of the fundamental computation of affordable pricing typical of mortgage purchases.

SVR: Many creditors use their own standard variable interest rate as the base for their credit product. This is the maximal amount of the mortgage's validity date. Only mortgages can have their total loan amount still to be paid at the end of the maturity whereas redemption mortgages are fully paid back at that point (when all due repayments have been made).

It is the juridical documentation showing the particulars of the juridical proprietor of the deed. Trackers mortgage: It is a mortgage that pursues a different interest will. Effective trackers rates can be adjusted to a percent above or below the rates they track. As an example, if BBR is 3% and the creditor provides a trackers installment of 1.5% over BBR the interest fee on the mortgage would be 4.5%.

Unpolluted property: Real estate that is fully occupied and on which no mortgage or credit is secure. Variable rate: The term shows that the interest rates vary and are not set. This is the interest that the creditor will charge you.