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PROPERTY SPEAK
Estate agency has its own language
The following is a guide to some of the terms used
Annual percentage rate - APR
The total cost of the loan including all fees etc. and is shown as a percentage rate per year
Assignment
Legal document transferring a lease of unregistered land. Specialist help from a Solicitor is essential
Assured Shorthold Tenancy
A form of assured tenancy which gives landlords an absolute right to repossession. New residential tenancies now automatically become ASTs unless otherwise stated
Bank of England Base Rate
This is announced from time to time by the Bank of England's Monetary Policy Committee. They set interest rates that Banks and Building Societies use to set their interest rates
Bridging Loan
A temporary loan that enables you to complete the purchase of a new home if you have to do this before completing the sale of your existing house
Buildings Insurance
Buildings insurance is essential in order to protect your property against hazards such as fire, flood and subsidence
Buildings Survey
Also known as a Structural Survey. This comprises of a full property inspection and gives comprehensive details of its conditon including any structural repairs needed, defects or work neeed in the near future. It is conducted by a Chartered Surveyor and this type of survey is suitable for any home, particularly older properties and those which have been poorly maintained
Buy-to-let mortgage
A type of mortgage specifically designed for investors buying a property with the intention of letting it out
Capital and interest mortgage
Also known as a repayment mortgage. Your monthly payments gradually pay off the money (capital) you've borrowed, and also cover interest on the amount outstanding
Capital Gains Tax (CGT)
A tax on profits made from the sale of financial assets such as a house, flat or shares.
Chain
The situation that occurs when a buyer is reliant upon completion of the sale of his existing property, in order to complete on the purchase of his new property
Charge
A legal restriction on a property (such as a mortgage). It is registered against the property until the loan is repaid and the charge is removed. Sometimes called a Second Charge
Commission
Fee paid to your estate agent, usually following exchange of contracts
Completion
The point, after contracts have been exchanged, when the legal ownership of the property is transferred from the seller to the buyer
Completion statement
A statement prepared by a solicitor upon completion
Contents insurance
Insurance to protect items in your home, including furniture and personal possessions, in case they're stolen, lost or damaged
Contract
The legal and binding agreement containing all the essential details of the sale. Once contracts are exchanged, the contract commits both buyer and seller to the sale/purchase of the property
Contract race
Occurs when two parties have made an offer on the same house. The vendor will sell to whoever exchanges contracts first
Conveyancer (Solicitor)
A solicitor or a licensed conveyancer who is a specialist in dealing with all legal aspects of buying and selling a property
Conveyancing
The term used for the legal work involved in the purchase and sale of a property
Covenant
Rules and regulations governing the property and contained in its title deeds or lease
Deeds
Often known as Title Deeds. They are the legal title documents that prove ownership of a property. They are transferred to the new owner on the sale of a property and are held by the mortgage lender
Deposit
The sum of money that is paid to the vendor's solictor on exchange of contracts
Dilapidations
Any disrepair or damage to a rented property
Disbursements
The fees paid by the conveyancer on the buyer's behalf, such as stamp duty, land registry and search fees
Draft contract
The preliminary, unconfirmed version of the contract that is drawn up when the sale is first agreed. It will set out the conditions of sale
Draft Transfer
A legal document issued by the vendor's solicitor to the purchaser's solicitor setting out the terms and conditions of sale
Easement
A right given to the owner of one property over an adjoining property, such as a right of way
Equity
The difference between the amount you owe on your mortgage and the current value of your property. For example if your house is worth £300,000 and you have a £160,000 mortgage, your equity would be £140,000
Exchange of contracts
When the sale contracts that have been agreed between a buyer's and a vendor's solicitir are exchanged. Once you have exchanged contracts both parties are both legally bound to complete the transaction
Fixtures and fittings
Items that are to be included in the sale of the house and will be detailed in the contracts
Freehold
The term used to indicate ownership of a property and more importantly land on which it stands. This means that once you have purchased the property you are the absolute owner of the property and the land it's on
Gazumping
When an additional potential buyer puts in a higher offer for a property after someone elses offer on the same property has been accepted. This does occasionally happen as there is no legal obligation for the vendor to sell their property to you until contracts have been exchanged
Gazundering
When a buyer lowers their offer after a sale has been agreed
Ground Rent
Rent paid to the owner of freehold land by a person who has a Lease
Guarantor
Someone who guarantees an obligation of another, for example on a rental contract
Homebuyers Survey
A property survey that should reveal any major faults in the property. It also includes valuation advice. It is not as detailed as a Structural or Building Survey
Inventory
A list which describes the condition of furnishings and contents of a rental property at the start and end of a tenancy in order that any dilapidations during the tenancy can be identified
Land registry
The official body responsible for recording the ownership of land and property
Land registry fees
Fees paid to the Land Registry to register ownership of a property. Normally these are paid to your solicitor
Land Search
A formal application for an inspection of the Land Registry register. A certificate is issued showing the current situation of the land in question
Lease
A legal document by which the freehold or leasehold owner of a property lets the premises (or a part of it) to another party for a specific length of time, after which point ownership may revert to the freeholder or superior leaseholder
Leasehold
Denotes that ownership of a property is by way of a lease
Legal fees
Fees that will be charged by your solicitor or conveyancer in relation to the purchase or sale of your property. Disbursements are payable in addition to the fees
Listed Building
Building or other structure of special architectural or historic interest
Local Search
A questionnaire sent to a local Authority by a purchaser's conveyancer to verify whether a property is affected by planning proposals, tree preservation orders, etc.
Maintenance charge
The charge (usually levied in flats) to cover the cost of repairing and maintaining the external or internal or communal parts of a building
Mortgage
The money advanced by a lender (such as a bank or building society) on the security of a property and repayable over the mortgage term
Mortgage deed
A legal document establishing a mortgage on a property. It contains the terms of the mortgage and the interest the mortgage lender has in the property
Mortgage Offer
A formal offer of mortgage issued by a building society, bank or other lender
Mortgage term
The period of time that your mortgage runs
Mortgagee
A building society or bank that lends money against a property purchased. Normally called the lender
Mortgagor
A person who borrows money, to buy a property. Normally called the borrower
Negative equity
When the amount you owe on your mortgage is greater than the value of your property
Offer
The sum of money that a buyer offers to buy a property
Office Copies
A Land Registry term for copies of registers and plans. They are officially marked 'office copy' and legally recognised
Pre-Contract Enquiries
Enquiries made by the purchaser's solicitor to the vendor's solicitor requiring information relating to the property being purchased prior to exchange of contracts
Probate
The legal term applied to the process of proving that a will is valid
Purchaser
The buyer of a property
Repossession
When a mortgage lender takes possession of a property due to non-payment of the mortgage
Reserve price
Properties for sale by auction are normally offered subject to a reserve price which is the minimun the vendor will accept
Retention
The holding back of part of a mortgage loan until repairs or specified works to the property are completed
Searches
Are undertaken by a conveyancer/solicitor during the conveyancing process to establish whether any issues exist which may adversely affect the property being purchased
Sole agency
The use of a single estate agent in the sale of a property
Sole Selling Rights
Means an agent is entitled to a fee no matter who buys the property
Stamp duty
A charge levied by the government on property sales. Stamp Duty has a starting theshhold. Your solicitor advise you know if stamp duty is payable and collect it on behalf of the government
Structural survey
Also known as a Building Survey. This comprises of a full property inspection and gives comprehensive details of its conditon including any structural repairs needed, defects or work neeed in the near future. It is conducted by a Chartered Surveyor and this type of survey is suitable for any home, particularly older properties and those which have been poorly maintained
Subject to Contract
Indicates that a sale is not yet legally binding
Survey
Carried out by a Chartered Surveyor
Surveyor
A person, usually a qualified member of the Royal Institute Of Chartered Surveyors who carries out professional surveys on properties
Tenancy agreement
A legal agreement designed to protect the rights of the tenant and landlord setting out all the terms and conditions of the rental arrangements
Tenant
The person who has temporary possession of a property
Tenants in common
This is when more than one person buys a property. You become tenants in common and it ensures that if one of you dies their share of the property forms part of their estate and does not automatically pass onto the other party
Tender
In the process known as 'For Sale By Tender' the asking price will not be stated. Instead, written offers will be invited and a closing date for such offers published. All offers are normally opened at the same time, usually with the vendor's solicitor present. Generally, the vendor is not committed to accepting the highest or any offer
Tenure
The conditions on which a property is held (i.e.freehold or leasehold)
Title
The ultimate record of ownership of a property, the evidence of which is found in the title deeds
Title deeds
See Deeds
Transfer deeds
The deeds that transfer the property into your name when you purchase a property. They are issued by the Land Registry
Under offer
When the vendor has accepted an offer to buy the property from a prospective purchaser it is said to be 'under offer'
Vacant Possession
A well used estate agency phrase which means that the property being offered will be vacant upon completion of the sale. The property is therefore offered free from any such encumbrances such as a sitting tenant or service tenancy
Vendor
The person who is selling a property
Yield
The income from a property calculated as a percentage of its value