Property Glossary – Find out What Everything Means!

We have endeavoured to put together the most comprehensive property glossary on the Internet. Be sure to book mark this page so that you know longer have to wonder, what different terms you come across mean – or what is the definition for things that you come across. Hopefully you will find the answers to 90% of these questions here and the other 10% will hopefully be taken care of in due course as we add more to this page.

You might also want to check out our in depth property abbreviations page.

No more wondering things like, what is the difinition of “Base Rate” or what does “Disbursements” mean or even what is the meaning of "Engrossment?"

If you don't find what you are looking for on this property glossary page, you might find it else where on our website. So as a last resort be sure to use the search function below to search both our website and Google for the answer you need.

Click on any of the letters below to go straight to that Letter on this property glossary page.

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

Acceptance

This is the document that you need to sign and send back to the Lender if you wish to accept the lenders mortgage offer.

Accident, Sickness and Unemployment Insurance (ASU)

This insurance covers the mortgage payments of the borrow in the event of an accident, sickness or involuntary unemployment.(This is also essentially the same thing as mortgage payment protection insurance (MRRI))

Additional Security Fee

This is an upfront free that is charged by lenders in order to protect themselves against the borrow defaulting on the loan. This fee is usually charged on mortgage that are over 75% LTV. It is also know as : Mortgage Indemnity Guarantee (MIG) or a Mortgage Indemnity Premium. (Can also sometimes be described as a higher lending charger)

Advance

The amount of money that your lender agrees to lend you

Adverse Credit

Just as it sounds, it is a term used to refer to people with a poor credit history. This may include but is not limited to, things such as county court judgments (CCJ’s), bankruptcy, mortgage arrears, Individual voluntary agreements (IVA’s) and credit card or other borrowing arrears or defaults.(Can also be referred to as Non-Conforming)

Agent

This is normally a person/company, organisation that has been appointed and who acts on behalf of a landlord, such as a letting agent, management agent or estate agent.

Agricultural Covenant

This is a very specific planning condition that allows the building of a residential dwelling on the condition that it is occupied by a person employed or associated with working the land in someway.

Applicant

This is how you are normally referred to by an estate agent/auctioneer when you are the potential buyer of a property.

APR

APR stands for 'Annual Percentage Rate' and is related to the interest on any loan you have.

Applicant

The term used by an estate agent to refer to you when you are a potential buyer of a property.

Appraisal

This is what is done, usually by an estate agent, when you are selling your property to determine what they think the correct current value of it is. They will come in and appraise your property.

Arrangement Fee

Sometimes you might need to pay this fee to lenders for arranging a loan for you.

Assignable Contract

This is where you can sell on a property before the completion date for more details visit this assignable contract page.

Assignment

This is when the ownership of a property is transferred from one person to another.

AST

AST stands for “Assured Shorthold Tenancy” if basically gives a landlord the right to reclaim their property back after a specified period of time. At the moment AST’s tend to be for about 6 months. For a more in-depth explanation vist this assured tenancy page.

Auction

This is a means of buying a property in a quick and open way. In an auction house, exchange is seen as having happened when the auctioneers hammer comes down for the final time for the winning bid.

Bank Automated Clearing System (BACS)

A type of funds transfer that is normally electronically donea and is automated it is normally free of charge free of charge.

Bankers Draft

Different to a cheque in that the money has already been debit straight from your account, therefore the person receiving the bankers draft is confident the money is safe, whereas with a cheque the money would not be safe until it has been cleared. There is normally an administration fee to obtain a bankers draft, as well as you having to give a notice period, normally of at least 24 hours.

Base Rate

This rate is set by the Bank of England and is used as a benchmark for lenders to set interest rates by. It represents the lowest rate of interest a bank will charge you when it lends you money. This rate is reviewed periodically thorough out the year and can go up as well as down.

Beneficial Owner

This is the person owning land and who is therefore entitled to it for his/her own benefit. This is different from say a trust etc that may hold land for the benefit of someone else.

Block Management

This refers to the agents that manage/act on behalf of the freeholds and leaseholds, normally for a block of flats or apartments. The will usually arrange things like, the insurance,tending the garden, general cleaning and re-decoration.

Booking Fee

Another term meaning arrangement fee. Booking fees are normally paid upfront to book the rate.

Break Clause/Release Clause

These are sometimes used in conjunction with fixed term tenancies. For example: in an AST after the first 6 months is over when it comes to renewal, either party (landlord or tenant), will often request that a break/release clause be entered into the agreement, if they are unsure whether they will want to continue renting the property for the duration of the next 6 months. This clause will normally allow either party to get out (normally with about 2 months notice) before the end of the new term.

Bridging Loan

This is a temporary loan that enables you to buy a property. it is mainly used for short term finance and should not replace a normal mortgage as the fees and interest are high. Visit our closed bridging and open bridging web pages for more in depth details on types of bridging.

Broker

This is a person that advises on mortgages etc. Known as a mortgage broker.

Building Insurance

This is a type of insurance that is required to cover against your property being damaged or destroyed. The sum that is insureed covers the estimated cost of rebuilding the property. (keep in mind this can vary greatly from the market value of the property.)

Buy to let (BTL)

This is when you buy a property with the main aim being to find tenants and let it out.

Buy to let Mortgage

This is a special mortgage product for landlords or would be landlords. It is for a property where the borrower intends to let the property out to tenants. This type of loan is normally given on the basis on projected rental income, rather than on multiples of the borrower’s income or salary.

Capital and Interest Mortgages

With a capital and interest mortgage the monthly mortgage payments pay off both the initial loan (i.e. cost of the property) and any interest that has been charged. Therefore at the end of the loan term, the entire debt will be repaid with nothing outstanding. (also know as a repayment mortgage)

Capital Rest Period

This is to do with the regularity with which the Lender calculates the outstanding balance on any give mortgage and hence the size of the monthly repayments. This figure is normally calculated annually, monthly or daily.

Capped Rate

This is a rate of interest that you agree to with your lender that will be the maximum you will pay during a set period of time. This is period of time is often the first 1-3 years of the mortgage starting, but it can be for longer. The interest rate cannot go any higher than this capped rate during this specified period of time.

Cash Back on completion

This is where you get cash back on the completion of a sale, it can be applied to both buying of developers and individuals. For a more indepth explanation vist this cash back on completion page.

Cash Back Mortgage

With this type of mortgage the lender will refund back a sum of money to the borrower. This will normally be refunded back on completion and will either be a percentage of the load or a flat figure. This type of rate will normally been that the borrow will be tied into the lender for a specified period of time at a specified rate.

Cash on Cash Return

This is the same as Return on investment. Click on the following link to find out more: Cash on Cash Return

Caution

These are entries that are on a the land register to protect the interest of a third part.

Chain

In property terms a chain refers to a sequence/chain of buyers and sellers all trying to buy a property while at the same time potentially trying to sell their own property. To learn how you as a property investor can make money from property chains visit this property chain page.

Chain Free

This is simply when the owner of a particular property does not need to sell their own in order to buy a new property; hence they are “chain free.” First time buyers are often chain free.

Charge

This is when a property owner has used his property as security against other borrows such as a loan. It they do this then a charge is registered and certified. This entitles the lender who the secured lending is done with is regarded as a secured creditor and that they will be paid from the proceeds of the sale of the property in the event of the property owner defaulting on the loan.

Charge Certificate

This is a certificate issued to the lender by the Land Registry that gives evidence of the lender’s charge over the property.

Chief Rent

This is a payment made on freehold land to the original freeholder forever. This differs from ground rent because ground rent normally has a limited period.

Collateral

The property is what is classed as collateral. It is classed as a guarantee that you will be able to pay the lender the loan. If you aren’t able to repay this loan the property could be sold by the lender in order to recoup the money they original paid you.

Company Let

This is when you have let your property to a specific bona fide company.

Completion

This is the final stage of the buying process. The ownership is legally transferred from the seller to the buyer.

Compulsory purchase order

(CPO'S) are normally issued by local authorities and they enable these authorites to purchase property or properties at some time in the future. For a more details explanation of CPO's click on the following link compulsory purchase order

Contents Insurance

This is insurance that you take out to cover the cost of your personal belongings, that are in your property, against anything detrimental that could happen to damage.

Contract

This is what both the buyer and seller buyer sign and binds both parties to the sale of the house. This is exchange of contracts and normally there is handed over of an agreed deposit (if any) to the seller.

Contract Race

This is what sometimes happens when two potential buyers want to buy the same property. The seller will normally be the one to instigate the contract race but it can also be instigated by a buyer. The winner of the race will be the first buyer to reach exchange of contracts.

Covenants

The covenants are the terms of any given tenancy agreement. They include any obligations or promises made by either the Landlord or the tenant. They are requirements by law on the owner of a property that they will either do or not do something with their property.

Conversion

This is a flexible term in property and can mean such things as a house that has been converted into flats or a loft converted into a bedroom, as well as other things.

Conveyancing

This is the legal process that transfers ownership from the vendor to purchaser.

County Court Judgement (CCJ)

You can get a CCJ if you default on a payment of debt. If you do get a judgment against you may have difficulty in getting credit in the future.

Credit Search References

These are references taken regarding a potential tenant. These references can be from sources such as the tenant’s employer. A check of the tenant’s credit history is also normally carried out.

Current Account Mortgage

This type of mortgage is a flexible mortgage that can keep all your finances in one place. It combines your mortgage with a current account and the money in the current account can be automatically set against the mortgage balance and then interest only charged on the outstanding amount of the loan. In practice this should mean that interest payments should be reduced.

Deeds

This are the legal documents associated with a property.

Default

This is when you have failed to make payments as you have agreed to. In property terms this is normally used when talking about missed payments on your mortgage.

Delayed Completion

Completion is classed as delayed if they take over 28 days to complete after exchange of contracts.

Deposit

This is normally a lump sum paid to the seller towards the overall cost of the property.

Direct Debits

Direct debits are used to make payment directly from a bank account. Direct debits are used usually used when the amount being paid might vary.

Disbursements

Disbursements are the term used to mean legal costs involved with purchasing a property.

Discounted Rate

A Discounted rate mortgage will have an interest rate lower than the lender's Standard Variable Rate.

Discounted Tracker Rate Mortgage

This is a variable rate mortgage that is discounted from the Bank of England’s base rate. It is usually discounted by a set percentage for a set period of time. In practise there are usually early repayment charges that will be charged if the loan is repaid within the discounted period.

Early Repayment Charge / Early Redemption Charge (ERC)

This is a fee that is sometimes payable it you pay off all or part of your mortgage before a pre-agreed time.

Early Redemption Penalty (ERP)

see early repayment charge

Engrossment

This is the final and formal version of a document that has been prepared by a solicitor in preparation for signing following the agreement of the final draft between parties.

Energy Performance Certificate (EPC)

This certificate is part home information pack and give you information as to have energy efficient your home is.

Equitable Interest

This is when someone has some legal rights to a property but these rights do not include the right to sell its legal title.

Equity

This is the difference between the market value of a property and the amount of the mortgage that is still owed to the lender on that property. click on the following link for more info: Equity

Exchange of Contracts

This is the point where the buyer and the seller become legally bound to complete the sale. Both will then be committed to completing the transaction.

Exclusive Mortgage

This mortgage is called an exclusive mortgage because it is only available through a specific packager in conjunction with the Lender who is going to provide the funding.

Execution

This is when a deed is signed sealed and delivered in front of an independent witness.

Execution Only

This is a service with no advice, just carry out the orders of a customer.

Fixed Rate Mortgage

This is a mortgage which has a 'fixed' rate of interest for a set period of time normally between 1-5 years.

Fixtures and Fittings

Any items included in the sale of the property. For instance curtains, carpets, wall lights, cooker etc. These should be agreed and confirmed before the sale of the property.

Flexible Mortgage

These are mortgages that allow you to pay them off in a flexible way, one example of this are mortgages that allow you to make overpayments so that you can pay off your mortgage early.

Flying Freehold

A flying freehold is formed when part of a freehold property overlaps unto a different freehold property or land.

Freehold

This is when you have complete ownership of a piece of land and the property that resides on it.

Full Status

This describes a borrower who has a good credit history and who is not self-certifying their his income.

Gas Safety Regulations

A landlord must make sure that a gas safety check is carried out prior to letting out any property. Then it needs to be completed annually and a copy of the record must be given to the tenant. This check must be carried out by an authorised CORGI register engineer.

Gazumping

Gazumping is when a vendor accepts an offer from one person only to later reject it in favour of a higher offer they receive from someone else. Click on the following link to learn how you can avoid being gazumped

Gazundering

This is a term used when a buyer reduces his offer immediately prior to exchange. In practise it is seen as the opposite of gazumping.

Gearing

This is basically using a small amount of money to secure a larger investment. For example, using a 10% deposit to secure the 100%ownership of a property. Also see "Negative gearing" below, as well as checking out the following link: Gearing Investment Property

Gifted Deposit

This is basically means that someone has gifted you the deposit on a property. This would normally have been a developer on a new build property you are buying. For a more in depth explanation visit this gifted deposit page.

Ground Rent

Ground rent only applies to leasehold properties and is a sum paid annually to the Freeholder of the property, by the leaseholder.

Guarantor

This is a person who agrees to guarantee that they will repay a loan or debt if you default on the payment of it. A typical example of this is when a parent guarantees the mortgage will be paid on one of their grown up children’s first property purchases.

Higher Lending charge

See Additional Security Fee

High Rent Tenancy

This indicates a tenancy agreement when the annual rent on a property is over £25,000 and is known as a contractual tenancy.

HMO

House in Multiple Occupation - things like bedsits etc come under this category. There are the subject to more rules and regulations than the average property. For a much more in depth thorough explanation vist this house in multiple occupation page

Home Information Pack ( HIP )

This is also known as a seller pack and is a mandatory pack required by all properties that are sold in on the open market. This has become mandatory since Dec 14th 2007. For more details visit our home information pack page.

IFA

IFA stands for “Independent Financial Adviser “ and means someone that has undergone specific training and has obtained specific qualifications to become a financial advice and to act independently without being tied to only recommending the products of any particular lender.

Improvement Grant

This is a grant given by the local authority towards the repair of the improvement of a property.

Income Multiples

These are the multiples that the Lender will apply to the borrower’s income when trying to decide what the maximum they will lend them for their mortgage is.

Indemnity

see Additional Security Fee

Individual Savings Account (ISA)

They are a way for people to save cash or shares without paying tax. They are also seen as a repayment vehicle associated with interest only mortgages.

Instruction

This is when you give an estate agent or auctioneer the right to sell your property. The resulting agreement between you and them confirms the terms under which the “instruction” is offered by you and accepted by the estate agent or auctioneer.

Interest only Mortgages

This is when you are only paying off the Interest on the mortgage over the term of the loan. You are not actually paying any of the mortgage amount itself. For this reason Interest only mortgages are often tied in with some other type of investment vehicle which is set up to cover the initial loan amount at the end of the mortgage term. This investment vehicles include things like, ISA,s endowment policies and personal pensions.

Introducer Fee

This is just as it sounds and is a commission that is paid by the Lender to intermediaries for introducing business to them. At the time of writing, if this intermediary receives a payment of more than £250 they are then obliged under the Mortgage Code to disclose to the borrower the exact amount they received. (This is also sometimes referred to as a Procuration Fee).

Inventory

This is a listing of the contents of any given property. This can include things like kitchen utensils and garden equipment etc. As well as the condition a property is in and the structural fixtures, fittings and power points etc.

Joint Tenants

See Tenants in common, later on in this property glossary page.

Joint/Multiple Agency

This is when you have instructed more than one estate agent to market your property. This can sometimes mean that you are paying higher commission fees because they are not your sole agent.

Joint/Several Liability

This is when there is to be more than one adult living in a property. The tenancy will normally say something like they are ?jointly and severally liable for responsible.? This means that they are all liable and individually each tenant is responsible for payment of all rent and all liabilities.

Land Certificate

This is a certificate that is issued by the land registry that proves ownership of land.

Landlord

A landlord can be a person, group of people, company or some sort of body that has a formal interest in a property and has the right to let that property out to tenants.

Land Registry

This is a government department where details of the ownership of properties and any charges against these properties are held.

Lease

A legal document which details the agreement between a freeholder and those that are tenants in of the freeholder. It lists all the conditions which the leaseholder must abide by and also what the Landlord responsibilities are.

Leasehold

This is normally described as ownership of Land/property for a fixed period of time. This ownership is subject to the annual payment of ground rent to the owner of the freeholder.

Lease Options

This is a way of combining leases and option agreements, for a detailed explanation click on the following link. Lease Options

Lender

The normally a company or person who lends you money for a agreed time period. There will normally be interest charged and they will expect their money back within this period plus the interest.

Lessor

This is the person etc. that grants a lease.

Let to Buy Mortgage (LTB)

This is a mortgage that allows you to borrow money to buy a new home to move into while your current home is let out to tenants. The maximum you can borrow for your new mortgage will generally be calculated without taking your existing mortgage on your current home into consideration, as long as the rent covers the mortgage on the current home.

Libor-Linked mortgage

This is a mortgage that is a variable rate mortgage that is linked to the London Inter-Bank Offered Rate and will normally be set at a certain percentage above the Libor rate within a given period of time. The Libor rate is often associated with lenders that offer Loans to borrowers with some sort of adverse credit history.

Lien

This is a term used for the legal right of one person to hold the property of someone else as security for a debt.

Life Policy

This is a policy/insurance that repays the mortgage in the event of the insured person’s death. (This can also be known as Term Assurance).

LTV

LTV stands for – "Loan To Value" And is related to the amount how much of a loan/mortgage you have on a property in comparison to how much the property is worth.

Maintenance Charge

This is the charge that will have been agreed in the initial contract with the landlord that covers costs of maintaining a property. Depending on the type of property in question, this will typically include things like keeping the garden and communal areas and outside of the property in good order.

MIG

MIG – stands for “Mortgage indemnity guarantee” and is an insurance premium that lenders sometimes require you to take out in certain situations.

Mortgage

A loan taken out for the purpose of buying a property, the property itself is the security that the loan will be paid back.

Mortgage Deed

This is a document that details the conditions of a loan/mortgage secured on a property.

Mortgage Indemnity Guarantee (MIG)

See Additional Security Fee for more details

Mortgage Offer

This is normally in letter form from the lender offering you a loan and setting out the conditions by which it is offered.

Mortgage Payment Protection Insurance

See Accident Sickness and Unemployment Insurance as they are essentially the same thing.

Mortgagor

This is the borrower/borrowers who are borrowing money for the purpose of buying a property.

Multiple Agency

See Joint/Multiple agency earlier in this property glossary page.

Negative Equity

This is when you owe more money to the lender than the actual market value of your property.

Negative Gearing

This is when there is a shortfall in the amount of income a property brings in in comparsion to the cost of the mortgage etc. Visit the following link for a more in depth explanation: Negative Gearing

Non-Conforming

See Adverse Credit

Offer

This is when you make an offer for a property for example: you can offer the asking price for a property or as many property investors do you can offer below market price for a property.

Offset Mortgage

This is a flexible mortgage that allows the borrowers balances of things such as mortgage debt, savings account, and current account to be taken into consideration for the purposes of interest calculation, even though they may all be in separate accounts. For example: Money in your savings or current accounts is set against your mortgage balance and then interest is only calculated and charged on the outstanding amount. In practise this should mean that your interest payments are reduced.

OMV

OMV stands for "Open Market Value" and is the value a property can achieve in the open market when there is both a willing buyer and willing seller.

Option Agreement

This is when you are given the right to purchase a property in a set period of time and the vendor can't sell it to anyone else in that time but you can pull out of the sale. Click the following link for amore in depth explanation: Option Agreement

Overpayment

This is when you make an unscheduled capital repayment i.e. you pay over what was agreed initially. This can be an effective way of repaying your mortgage before the end of the term and saving yourself a considerable amount of interest. With some mortgages you will be charged a fee for overpaying or for overpaying over a certain amount.

Packager

Relates to a mortgage packager who are people that basically get all the documents relating to your application to a lender, ready for you. Click on the following link to find out more: packager

PCM

PCM stands for “Per Calendar Month” and is normally used when talking about the rental figure per calendar month (PCM).

Peppercorn Rent

This is a term used to mean a ground rent that is of a trivial sum.

Personal Equity Plan (PEP)

Personal Equity Plans (PEPS) were tax efficient investments that where available in the 1980’s and 1990’s. Many people used them as an investment vehicle to go along with an interest only mortgage.

Portable Mortgage

A portable mortgage is one which allows the borrower to move their mortgage from one property to another without penalty within an early repayment charge period. Portable mortgage can be very important, for example: if there are early repayment charges for the first 3 years on your mortgage, then if you wanted to move house after say 19 months and didn't have a portable mortgage, then you would have to pay the charges and then get a new mortgage product.

Preliminary Enquires

These are s set of questions, usually that are raised by the purchasers solicitor. These questions will be sent to the vendor’s solicitor to ask for clarification on any points about the property and the ownership of it by the vendor. This preliminary enquires will normally be sent prior to exchange.

Private Residence Relief

A tax relief relating to your principal home. check out our private residence relief page for an in-depth explanation.

Private Treaty

This is the method employed by most estate agents. It is referred to as “sale by private treaty.” The estate agents take down a description and the particulars and advise the property in question. They receive offers to buy the property. If a sale is agreed then the formal contracts etc will be issued by the solicitors and those contracts will be signed and exchanged between the vendor and purchaser.

Probate

A probate is the official process of proving a will is valid. If the will involves a property, things such as inheritance tax etc need to be taken into account. A probate valuation can be obtained which is normally a negotiated value with the district valuer who represents the Inland Revenue. It is vital for a potential purchaser and the vendor to understand that the sale of a property in this situation cannot proceed to exchange until probate is granted.

Procuration Fee

See Introducer Fee

Redemption

Redemption refers to the moment when you pay off your mortgage

Registered Land

This is land (including any property on it) in which title is registered at the Land Registry.

References

This is what is done to check a potential tenant’s suitability to rent a property. Such things as contacting previous landlords, present employer and doing a general credit check can come under this category.

Release Clause

See explanation of break clause further up in this property glossary page.

Rental Agreement

See tenancy agreement, a bit further down this property glossary page.

Repayment Mortgage

See capital and interest mortgages.

Retention

This is an amount of money that is held back from the initial loan and will not be paid out by the lender until specific repairs or improvements have been carried out by the purchaser.

Return on Investment (ROI)

This term refers to how much you get out of an investment in comparison to how much you have put into it. Click on the following link to learn more: return on investment

Right Of Way

An individuals legal right to use any particular part of a property so as to gain access to their own property.

Right to Buy (RTB)

This is when a tenant living in a council-owned (or sometimes housing association or other social housing owned) property, can purchase the property at a discount. Generally the size of the discount depends on the length of their tenancy. In the 1980’s and 1990’s there could end up being a sizable discount, but these days the discount is often capped, no matter how long you have lived there

Reversion

This is a special type of property purchase. You have an agreement with the vendor that they can still continue to live there for a specified time, normally until they die or some other significant agreed event happens. For more details on reversions vist this property reversion page

Searches

Searches are a term used to refer to the determining of whether there are any unwanted/adverse effects in relation to a particular property. This should cover things that are already in place and things that are being planned.

Self Build

This is when you build the property yourself. If you are a builder you could build it yourself by hand otherwise you can commission builders, surveyors etc to be involved with the planning and building.

Self Build Mortgage

This is a mortgage that is taken on to build a property. It the loan amount is generally paid out in stages as the building is progressing.

Self Certification Mortgage (S/C)

This is a mortgage where a buyer does not provide evidence of there income but instead they state their income and sign a confirmation of their ability to repay the mortgage. Normally the rates of a self certification mortgage will be higher than those of a standard mortgage.

Sellers Pack

See Home Information pack, future up this property glossary page.

Services/Utilities

This covers thins like gas, electric and water. In most cases the tenant pays for these.

Shared Ownership

This is a scheme that is operated by various Housing Associations where the borrower buys and owns part of a property i.e. a percentage such as 40%, 50%, 75% etc and they pay a mortgage on the percentage they own. The Housing Association owns the rest of the property and the borrower pays rent to the Housing Association on this. The borrower would normally have the right to purchase a higher percentage of the property in the future.

Sitting Tenant

This is when someone occupys a property as a tenant and they have legal rights without a lease. A property with a tenant in many times has a much lower asking price.

Sole Agency

This is where only on agent has been given the right and the authority to sell a property.

Sole Selling Rights

This is where one agent has complete control over the sale of a particular property. This agent is generally entitled to his fee however property is sold.

Split Loan

A split loan is a mortgage that can be taken partly on a capital and interest basis and partly on an interest only basis.

Stamp Duty

This is tax that the purchaser has to pay to the UK government when buying property. There are certain exemptions such as property under a certain value and there are also certain locations that are allocated exempt status for specific reasons.

Standard Variable Rate (SVR)

This is the default variable rate the Lender offers to borrowers on their standard residential mortgages. It is also normally the rate that mortgage is reverted back to at the end of any special discount period.

Standing Order

This is what you would normally get a tenant to set up to pay you rent directly. It is called a standing order mandate and is the instruction to the tenants bank to pay you a set figure on a regular basis for example £850 rent on the 1st of each month.

Studio flat/apartment

This is a flat or an apartment with the bedroom/living room all in one. It will normally have either a separate kitchen or a kitchen in the corner of the main room. It will still have a separate bathroom and toilet.

Subject To Contract

This is a term that is used to indicate a provisional agreement between buyer and seller prior to exchange of contracts. At this stage either party is still free to pull out of the transaction.

Superior Landlord

The superior landlord is the landlord is the one who the ownership of a property might revert to at some stage for example; a flat with a 99 year lease.

Superior Lease or Head Lease

These are often applicable in a flat where the flat owner has the leasehold interest but the freeholder has the freehold. It is basically the lease that the landlord holds. There is then a lease under which the property owner is responsible for any covenants or obligations etc. Then when a property is let to a tenant this tenant will also have to comply with any of these covenants or obligations for example: not hanging washing on a balcony.

Survey

A report that is produced on a property that for the purpose of determining the value of the property, whether it is structurally sound and whether it is the sort of property the lender will be prepared to lend on. This report is carried out by a qualified surveyor after he has inspected the property. You generally have three tiers of report available: Valuation, Home Buyers and Structural. The structural is the most in-depth and hence normally the most expensive.

Tenant

A tenant is a person or persons (can be a company or organisation) who is entitled to occupy a property under the terms and conditions of a tenancy agreement.

Tenants in Common

This is when two or more people are co-owners of a property. When one dies, their share of the property automatically passes to the other/others.

Tenancy Agreement

This is the document that contains all the details and terms and conditions of the tenancy. It is also known as a rental agreement. It is a legally binding document.

Tenancy at Will or Licence

This can come about (especially for property investors) when after exchange of contracts a purchaser wants to gain access to the property before legal completion. This can be for things like to start the renovation etc. This can be organised formally through the solicitors and a licence arranged between both the vendor and the buyer. In this situation the buyer might agree to pay an appropriate rate of interest on the balance of money owed for the property (i.e. the purchase price of the property less the deposit that they have already paid). The will pay this instead of paying rental.

Tender – For Sale by Tender

This is when an asking price is not stated but offers are invited in writing. There will be a set time and date for the offers to be opened and it will usually be in the presence of the vendor’s solicitor. Normally an acceptance of an offer by the vendor constitutes an immediate contract. Therefore it is important that the potential buyers have done there due diligence before hand and had appropriate surveys done etc. It is also important from the vendor’s point of view that they have reserved the right to refuse the highest offer.

Tenure

This is relating to whether a property is freehold or leasehold, it denotes the type of ownership a property has.

Term Assurance

See LIfe Policy

Title

This denotes the legal right to ownership of a given property.

Title Absolute

This is the highest form of tenure available. (see a bit further up this property glossary page for an explanation of tenure).

Title Abstract of

This is a summary of the title documentation that is used in the conveyancing of unregistered properties to prove that the vendor has the right to sell that particular property.

Title Deeds

These are legal documents that describe the rights and the liabilities that are attached to a property and they also prove ownership of a property.

Title Report

A solicitors certificate that confirms that the title of a property is acceptable. This is a vital certificate that a lender must have before they will issue the cheque for mortgage monies.

Tracker Mortgage

This is a mortgage that moves in line with the Bank of England base rate, normally by a set percentage and for a set period of time.

Under Offer

This is when a vendor has accepted an offer for the property but contracts have not been exchanged on it yet. At this stage either part can still withdraw from the sale/purchase of the property. It is at this stage that you will normally see the estate agent change its sales board outside a property from reading just “sale” to “sold subject to contract.”

Vacant Possession

This is when the property is vacant. The previous occupants of the property must vacate the property before you move in.

Valuation

Whether the borrower is purchasing or remortgaging a property, the Lender undertakes a valuation of the property to ensure it provides adequate security. This charge is borne by the borrower (unless the lender is offering a special deal) and increases exponentially with the valuation/purchase price. There are 3 levels of valuation: in order of increasing detail these are Basic, Homebuyers' Report, and Structural survey. The more detailed the valuation, the higher the fee.

It is also a service offered by estate agents or other property professionals to try to ascertain the value of your property in the current market.

Valuation Fee

See Valuation above

Vendor

This simply is another word for the person who is selling a property.

Vendor Deposit

This is when you use creative financing to get the vendor to pay the deposit or part of the deposit for you. For more details vist this vendor deposit page

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