Finding your perfect property is just the very start of your homeowner journey.
It’s good to be in the know, so understanding some of the terminology used by estate agents, mortgage advisers and solicitors can put you one step ahead.
That’s why we’ve put together our very own jargon buster to give you a helping hand!
Affordability – This is a calculation on your income and outgoings to distinguish if you can afford the amount you want to borrow.
Buyer – This is you! The person purchasing the property.
Credit Check – A lender will check your credit file for existing credit commitments such as credit cards, personal loans and your financial history.
Completion – This is a date that is agreed with everyone for you to complete the purchase. This is when funds from the lender are released to the solicitor and you will receive the keys to your new property!
DIP/AIP – Decision in Principle or Agreements in Principle, these both mean the same thing and it is a lenders way of doing a basic check on your affordability to see if you can borrow the amount required. This is not a full application and this is not guaranteed you will get the mortgage.
Enquires – These are question’s your solicitor will ask the vendors solicitor about the property.
Exchange of Contracts – This is when solicitors exchange contracts and you as the buyer are requested to sign as well as the vendor. Once you have signed you are legally bound to buy the property.
LTV – ‘Loan to Value’ this is the amount you want to borrow compared to the amount the property is valued at. For example, you’ve had an offer accepted on a property for £100,000 and you have £10,000 deposit the loan to value for this would be 90%. This is because you want to borrow from the lender £90,000.
Mortgage Application – This is when your adviser will complete a full mortgage application with all your personal details.
Mortgage Offer – This is a binding agreement between yourself and the lender. This will be acceptance that the lender will borrow you the amount requested. From this point your solicitor will take over your buying process.
Offers in the region of – Putting in an offer on a property around the asking price.
Offers over – Putting in an offer on a property over the asking price.
Searches – Your solicitor will request searches from the local authority you are purchasing the property from. These can include but not limited to: local searches, land registry search and water authority searches.
Solicitor – A solicitor is a legal professional and this is where the legal process starts.
Underwriting – When an application is processed with a lender this will go through underwriting checks, they will check your documents and information provided and will make a decision if they are happy for you to have the loan amount requested.
Valuation – Although the estate agents have estimated the value of the property you are purchasing, the lender will want to assess the property to make sure it is worth the asking price.
Vender – The person selling the property.
Looking for your first mortgage?
Here at signature, we’re on the journey with you! From your first credit-check and valuations to the mortgage switch, our trusted mortgage advisers are here for you at each and every stage. We’ve been delivering the best first-time buyer mortgage solutions for years. It’s fair to say we know the industry inside out and know where to look to get the best deals that are tailored to you.
Why not drop us a line, and speak to one of our experts
