Glossary

For anyone unfamiliar with some of the terms associated with the house buying and moving process here’s a list of some of the key phrases and words you are likely to come across, and what they mean in layman’s language.

Key words and phrases

Bridging Loan – A loan to ‘bridge the gap’ when the sale of your present property doesn’t exactly coincide with the purchase of your new one.

Buildings insurance – This covers the bricks and mortar of your home. It is advisable to review insurance cover regularly.

Buildmark- The Buildmark 10 Year warranty and insurance cover provided on all new homes by the National House Building Council.

Completion – The finalising of the sale when all the monies are passed over and the buyer has legal right to the property.

Contents insurance – This covers the value of what you keep in your home. Contract Entered into by the seller and buyer of a property, which only becomes binding on exchange of contracts, that is when both parties have signed the contract and the purchaser has handed over the agreed deposit to the solicitor.

Conveyancing – The legal transfer of a property from one owner to another.

Covenant – A restriction or condition which affects the property and which must be complied with.

Deeds – All the legal documents relating to the property.

Deposit – A part payment of the agreed purchase price paid by the buyer on exchange of contracts.

Disposition – A legal document which transfers ownership of a property to the buyer.

Energy Performance Certificate – All sellers of properties in England and Wales are required to provide a valid Energy Performance Certificate (EPC which sets out the energy efficiency of the property. Exchange of Contracts The contracts are in fact two identical documents, one signed by the seller and the other by the purchaser. When these are exchanged, both sides are legally bound to complete the transaction.

Freehold – The full ownership of both the property and the land on which it stands.

Ground rent – This applies to leasehold properties and is a sum paid annually to the freeholder by the leaseholder.

Management Company – Apartment buildings usually have a management company responsible for maintaining the main structure, common areas and landscaped areas. On some developments a

Land certificate – A certificate issued by the Land Registry as proof of ownership and fees to register your ownership are paid through your solicitor.

Leasehold property – Real property whereby the owner has the right to occupy a property for a fixed period of time.

Local Authority Search – This will be carried out by your solicitor to establish if your new home is likely to be affected by any planning decisions.

Mortgage – Most people will need to take out a mortgage – or loan – to buy a house. There are many different types of mortgages available to home buyers.

Mortgagee – The lender.

Mortgagor – The borrower (whose property is secured for the loan).

Mortgage Indemnity Insurance / Guarantee – Your mortgage lender will usually require additional security if the loan is in excess of 70% or 80% of the purchase price. The amount of the payment varies with the amount borrowed and the term of the loan, which can usually be added to the mortgage.

Mortgage Protection Policy – An insurance policy often arranged in conjunction with a repayment mortgage, which is taken out to ensure that the loan will be paid off should the borrower die before the end of the mortgage term. Insurance may also be available to protect your repayments in the event of redundancy.

Mortgage Valuation Survey – Prior to making a mortgage offer your lender will have the property valued for mortgage purposes.

National House Building Council – A non-profit making body whose role is to both protect the home buyer and help the industry to construct good quality new homes. NHBC inspectors carry out spot checks and regular examinations on all properties at varying stages of construction.

Stamp Duty – A Government tax on the purchase price of a property which your solicitor will automatically handle

Sold Subject to Contract – Sold ‘Subject to Contract’ (STC) means that the seller and buyer are proceeding with the sale but the paperwork is not yet complete.

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