Back to school – Lesson One - Getting to grips with property jargon

HURRAY! The kids are back at school and we thought it would be a great time to teach you something too! How many times have you been flicking through your local paper or online and not fully understood some of the property phrases? Some confusing jargon can also be found when looking for a mortgage or if you are considering renting or letting a property. It’s ok, you’re not alone! In our A to Z you can find simple explanations to these words and expressions

A

Acceptance – Once you have been accepted for a mortgage you will need to sign a document of acceptance from your lender.

APR – The Annual Percentage Rate is the total cost of a loan that includes interest charges arrangement fees and other costs all shown as a percentage.

ARLA – The Associate of Residential Lettings Agents is the UK’s leading professional body for letting agents.

Arrangement Fees – These are costs that are charged by your mortgage lender to arrange your loan.

AST – Short for, Assured Shorthold Tenancy is a rental agreement where the tenants rent does not exceed £25,000 a year.

B

Base Rate – The Bank of England charges a rate of interest for lending money to other banks, this is known as the base rate. Your bank will use this rate as a benchmark for the rates that they charge you when lending money.

Building Inspection/Structural Survey – When buying a home you will always need a building inspection or Structural Survey to report of the physical condition of a property.

C

Chain – Your home or potential new home is in a ‘chain’ when several property sales and purchases are dependent on each other.

Conveyancer/Conveyancing – A conveyancer can be a solicitor or licensed conveyancer who deals with the legal side of buying or selling your property. Conveyancing is the legal process pf transferring the ownership of a property. The buyer and seller will each have their own conveyancer for this process.

Credit Search – A landlord will request references using a credit search for a tenant applying to rent their property. This search will check a tenant’s credit history as well as proving that they are financially suitable to rent.

D

Deposit – When purchasing a home the buyer must pay an amount of money on exchange of contracts, the cost of the deposit is usually 10% of the purchase price.

DPS – The Deposit Protection Service is authorised by the Government and is free to use for all landlords and lettings agents. The tenants deposit is paid to the DPS and paid back at the end of the tenancy.

Disbursements – During your conveyancing you will need to pay for additional items, these include Stamp Duty Land Tax, Land Registry fees, search fees, mortgage redemption costs and any further expenses.

E

EPC – An Energy Performance Certificate shows the energy efficiency and carbon emissions of your home as well as giving an indication of your fuel bills.

Equity – This is the amount that you own of your home. This can be calculated by taking away the amount of your mortgage from the value of your home.

Exchange of Contracts – Once the conveyancer actions the exchange the buyer and seller both sign the contract for sale. When this is complete the sale is binding.

F

Fixtures and Fittings – The seller must complete a fixtures and fittings form that confirms what is included in the sale of the property. When renting you should check what is provided in your rental home.

Freehold – Freehold guarantees that occupation continues for an indeterminate period of time.

G

Gas Safety Record – All landlords must legally provide a gas safety certificate stating that all gas appliances are safe by a CORGI registered engineer.

Ground Rent – This is an annual charge by the freeholder to the leaseholder of a property.

H

Home Buyer Survey/Report – Not as details as a structural survey but is a simple report designed for you to discover and understand the physical condition of a property.

I

Inventory – When renting you will receive a list of the property’s contents known as an inventory.

L

Land Registry – This is the government office which is responsible for holding records of land ownership.

Leasehold – When you occupy a property by way of lease agreement for a specified period of time. A lease term can vary but is usually 99 125 or 999 years.

Local Authority Search – When buying a property your conveyancer will make a formal enquiry to the local authority to find out if there are any matter affecting the property.

M

Maintenance Charge – These charges are typically found in leasehold properties to pay for the insurance and maintenance of the building.

Mortgage Valuation – Your lender will instruct a surveyor to state the value of your property.

Multiple Agent Instructions – This is when more than one agency is instructed by a seller or landlord to sell or let their property.

N

NAEA – The National Association of Estate Agents is the leading professional body for estate agency.

O

OIEO – You might see this alongside a property’s for sale price, it simply means ‘Offers In the Excess Of’.

Open House – Your estate agent may suggest an ‘Open House’ offering potential buyers the option of viewing your property over a few hours all at once on a specific day.

P

Property Ombudsman –The Property Ombudsman offers a free and independent service for resolving disputes between sales and letting agents to its members.

S

Searches – Your lawyer will complete searches to check if there is anything that might affect the current or future value of your property.

Sole Agent – When only one agency is appointed to sell or let a property.

SDLT – Stamp Duty Land Tax is the tax that must be paid to the government upon purchasing a property over a specific price. You can find the latest tax bands here.

SSTC – If you see these letter alongside a property it means that it is ‘Sold Subject To Contract’.

Survey – A report by a qualified building surveyor to check a property for any faults. There are three types of surveys depending on the depth of information required.

T

Tenancy Agreement – This is a legal document between a tenant and landlord governing the occupation of a property.

TDS – The Tenancy Deposit Scheme is designed to protect the tenant’s deposit and resolve any disputes between landlords and tenants.

U

Under Offer – When a seller accepts and offer and the legal processes have begun their property is then ‘under offer’.

V

Valuation – The open market value of a property by an estate agent. You can receive instant and free valuations on your property here.

Vendor – This is the person selling a property.

If you have any questions about property jargon that hasn’t been answered in our list you can call your local branch and a member of our team will be happy to help. Buying, selling, renting or letting a property can sometimes be confusing but are experts in our field always on hand to help our customers.