Having the information you need at the right time when buying a house can be the difference between a smooth, stress free transaction and potentially delaying a purchase. We’ve put together a glossary of terms that might come up during your purchase to give you peace of mind.
An agreement in Principle (AIP) – sometimes referred to as a Mortgage in Principle or Decision in Principle – acts as a written estimation of what a mortgage provider would be prepared to lend a perspective borrower ‘in principle’ based on details provided regarding income, outgoings, and any debt.
A credit score is a number that shows how likely you are to be accepted for credit, the higher the score the more likely you are to be accepted for a credit application or loan.
Other property transactions of a similar type within proximity to the inspected property where reference is made for valuation purposes.
This is the stage where you take legal ownership of the property whereby your legal representative transfers
all remaining funds to the seller’s representative.
Designated to areas with special architectural or historical interest, conservation areas have restricted planning permissions and controls in place in the interest of preserving the character of the area. To find out more about the controls or planning permission for a specific area you will need to contact the local planning authority.
A licensed conveyancer or conveyancing solicitor will be your legal representative throughout the property purchasing process. They will conduct all the legal proceedings associated with your purchase including the legal property transfer.
A payment contributing towards a percentage of the purchase price which is paid to the seller through your legal representative upon exchange of contracts.
An EPC provides a rating of the property’s energy efficiency on a scale from A-G, with A being the highest efficiency band. This will be determined based on a scoring system assessing the key energy performance areas within the property. Alongside the current rating will be a potential score that could be reach if suggested improvements were to be made. An EPC is required for any property sale unless exempt.
Equity is how much of the property you own. This is the difference between the value and the amount of debt you owe on the property.
An EWS1 certificate is an External Wall System Fire Review certificate. They are used when a leaseholder is
buying, selling, or re-mortgaging an apartment in a multi-storey, multi-occupied residential building.
When contracts are exchanged between the buyer and seller. Exchange of contracts signifies the legally binding point of the purchase process where both parties are legally bound to the sale or purchase of the property. At this point pulling out of the sale will be considered a breach of contract and will result in financial repercussions.
Fittings are items in the property that are not fixed or physically attached to the property. E.g., white goods, furniture, curtains.
These account for items that are attached to the property, fixed to the floor wall or ceiling. E.g., light fittings, boilers, radiators.
You own the right to the property outright inclusive of any land or outbuildings.
The HM Land Registry is the government organisation that safeguards land and property ownership across England and Wales.
An inspection of a property by a qualified surveyor to examine the condition of the property and highlight any areas of concern or useful information about the property ahead of purchase. A home survey is not the same as a mortgage valuation. Take a look at our survey options here
A protection policy that is usually purchased during the conveyancing process to cover a legal defect and protect against potential loss or damages in the event that a third party were to make claims against the property you are purchasing at a later point.
A legal contract between landlord, leaseholder, and any other party such as a property management company detailing the rights and duties of each party and any the obligations included as a requirement of the lease agreement.
If you own the leasehold to a property, you have the right from the freeholder to access and occupy a property for a fixed period.
A binding document defining the business relationship being entered into by a company and a client setting out the terms of agreement including client instruction, fees, timescales, and other relevant information.
A listed building is a structure that is considered to be of particular architectural or historical interest and therefore deserving of special protection.
This refers to the set of data provided by the relevant local authority containing information about a property, piece of land and the local area.
This is a form that collects information about a property held by landlords and managing agents – for example, information on ground rent and service charges.
Also referred to as non-conventional construction, this refers to a property where the build or materials do not conform to the standard definition, usually comprising of a brick or stone wall build with a tile or slate roof.
An assessment made by a RICS valuer at the instruction of your mortgage lender to ascertain whether there are any issues that could be considered significant enough to affect value of the property or to cause concern for the mortgage lender. This is for the lenders purposes and is not the same as a survey. Read more about our mortgage valuations here.
The ombudsman is the UK’s official professional body appointed to investigate consumer complaints against a company or organisation.
A property chain is formed when a group of property buyers and sellers are linked together because their purchase or sale depends on another sale somewhere along the chain.
Searches are carried out by your conveyancer to give you more information about the property you plan to buy. They ensure that there are no concerning factors you should be made aware of ahead of your purchase. Examples include water and drainage searches, environmental searches, and flood risk searches.
A commission paid from one business to another in exchange for referring customers to use a business’ services.
A payment made to a developer to secure a property that usually counts as a part payment towards the property’s purchase price. Typically used in the sale of new homes or for a property sold under the conditional auction method.
The Royal Institution of Chartered Surveyors (RICS) is a global professional organisation which governs and trains chartered surveyors and other property professionals. It regulates standards for valuing, operating, and developing types of property, land, real estate, construction and infrastructure.
A small defect or unfinished piece of work in the property after the building work has been completed. Typical in new build homes.
Sold Subject To Contract (SSTC) is where an offer is made on a property and accepted by the seller, but is not legally binding until exchange of contracts allowing either party to pull out of the sale with no legal repercussions.
A qualified professional who carries out property inspections to advise on the condition and to identify any potential areas of concern.
Stamp Duty Land Tax (SDLT) is a tax charged in property transactions across the England and Northern Ireland for homes costing more than £125,000, excluding first-time buyers. For more information on Stamp duty visit the gov page here: https://www.gov.uk/stamp-duty-land-tax
The legal document signifying the ownership of a property and any accompanying land.
Large appliances used domestically such as refrigerators, freezers, washing machines.
Book a home survey with SDL Surveying and we’ll help highlight if there are any issues with the property that may not be immediately obvious when viewing a property.
