Loan to Value (LTV)

Loan to Value is the proportion of the value or price of the property (whichever is the lower), that you borrow on a mortgage. For example, a £90,000 mortgage on a house valued at £100,000 would mean an LTV of 90%.

Stamp Duty

This is a Government Tax charged on purchases of land or property over a certain value. This is charged at different rates depending on different limits and property types.

Valuation Fees

A standard valuation report is a basic assessment of the condition and value of the property. It is purely for the benefit of the Society. You may decide to have a more thorough Homebuyers Report or a full structural survey carried out. These types of reports are more expensive than a standard mortgage valuation.

Legal Fees

A solicitor will handle all of the legal proceedings up to and including completion of the mortgage.

Product Fees

If applicable, these are payable when you apply for your mortgage with us. We will inform you of any product fees at the outset.

Capital and Interest Mortgage

A type of mortgage where each month you pay both the interest on the loan and an element towards the mortgage amount borrowed. The mortgage balance decreases each month (assuming regular payments are made). The mortgage amount would be completely repaid at the end of the mortgage term.

Interest Only

A type of mortgage where each month you only pay the interest on the outstanding mortgage amount. This means that at the end of the mortgage term, the mortgage amount will still remain outstanding. With this type of mortgage you would need a suitable repayment strategy to repay the mortgage in full at the end of the mortgage term.

Annual Percentage Rate of Charge (APRC)

The Annual Percentage Rate of Charge (APRC) is the total cost of the loan expressed as an annual percentage. The APRC is provided to help you compare different offers and is calculated using assumptions regarding the interest rate. If part of your loan is a variable interest rate loan, the APRC could be different from that quoted if the interest rate for your loan changes.

It takes into account the initial rate of interest, any other charges applicable e.g. valuation fee, application fee, solicitors costs and the amended rate when a discount or fixed rate period ends i.e. if the mortgage were to revert to the Standard Variable Rate at the end of the agreed product term date.

We will also provide another figure to reflect the volatility of interest rates and to illustrate if these were to increase, what impact this would have on your mortgage payments and for you to think about whether this will be affordable to you in the future. The figure used is the highest that the Bank of England Base Rate (BBR) has ever been within the last 20 years. This is then added onto our current Standard Variable Rate. This will illustrate to you the true rate of interest charged over the whole period of the loan if this circumstance occurred. This will be detailed in your mortgage illustration.

Early Repayment Charge (ERC)

An Early Repayment Charge may be payable if the mortgage is repaid in full or part before a set date. Your mortgage illustration and mortgage offer letter will set out how much it will be and the time period it will last for.

Cashback

With some products you may receive a cashback when you complete on your mortgage. Your mortgage illustration and offer letter will set out how much it will be and when we will pay it.

Completion Date

The day that the property becomes legally yours. Your solicitors will arrange a completion date with you for the purchase or remortgage of the property.

Additional Borrowing

The facility for existing mortgage account holders to borrow extra money from us. This may be available for a variety of reasons, but would be subject to you meeting the Society’s criteria and Responsible Lending Policy.

Conveyancing

Conveyancing is the legal process involved in buying and selling a property.

Daily Interest

Where the interest charged on the mortgage is calculated on a daily basis. It is calculated on the balance outstanding at the end of each day.

Equity

The equity in your property is the difference between the value of the property and the amount of mortgage outstanding.

Exchange of Contracts

Exchange of contracts occur when the buyers and seller’s conveyancers exchange signed contracts. Once this exchange has occurred both parties are legally bound.

Financial Conduct Authority (FCA)

The Financial Conduct Authority is the regulatory body for the financial services industry in the UK.

Their aim is to protect consumers, ensure the industry remains stable and to promote healthy competition between financial services providers.

Freehold

If you own the property as a ‘freehold’ tenure, then you own the property and the land that the property is built on.

Mortgage Illustration

A mortgage illustration outlines the terms of the mortgage and the total cost of the mortgage specifically to your requirements. This mortgage illustration will be provided to you by one of our Qualified Mortgage Advisers.

Leasehold

If you own the property under a ‘Leasehold’ tenure, then you own the property but not the land it's built on. The land remains the owner of the landlord, also known as the ‘freeholder’. Ownership of the property will also revert back to the freeholder once the lease runs out. Leases can last for decades or centuries. There is usually an annual charge for the lease, called a ground rent.

Standard Variable Rate (SVR)

The Standard Variable Rate usually known as the SVR is a variable rate of interest. This means that your payments can go up or down. Each lender sets their own Standard Variable Rate to reflect market conditions and it is at the lender’s discretion as to when this changes.

Mortgage Term

The mortgage term is the number of years in which you agree to pay back your mortgage. The Society currently offers mortgage terms from 5 years to 40 years.

Fixed Rate Mortgage Product

This type of mortgage sets the interest rate that you will pay for a given period of time, thereby providing you with the stability of knowing exactly what your monthly payments will be for that period. Once the fixed rate period has expired the mortgage will automatically revert to the Society’s Standard Variable Rate (SVR) applicable at the time. However, prior to the end of the fixed rate period we will contact you to inform you of any other products we have available for you to transfer over to. We aim to make this process as straightforward with as little cost as possible.

Discount Mortgage Product

This type of mortgage provides a discount off the Society’s Standard Variable Rate (SVR) for a specified period of time. As our Standard Variable Rate can change at any time, this means that your mortgage interest rate can also change and therefore your monthly payments could increase or decrease accordingly. Once the discounted rate period has expired the mortgage will automatically revert to the Society’s Standard Variable Rate (SVR) applicable at the time. Prior to the end of the specified discounted period, we will contact you to inform you of any other products we have available for you to transfer over to. We aim to make this process as straightforward with as little cost as possible.

Tracker Mortgage Product

This type of mortgage directly tracks the Bank of England Base Rate. When there is an increase or decrease in the Bank Base Rate, the tracker rate of interest will also increase or decrease. Once the tracker rate period has expired the mortgage will automatically revert to the Society’s Standard Variable Rate (SVR) applicable at the time. Prior to the end of the specified discounted period, we will contact you to inform you of any other products we have available for you to transfer over to. We aim to make this process as straightforward with as little cost as possible.

Flexible Mortgage Product

This type of mortgage can offer you greater control of your finances by allowing the option of overpayments and payment holidays.

Offset Mortgage Product

An offset mortgage product is where you have a savings account and a mortgage account with the same provider. The cash savings are used to reduce the amount of mortgage interest you’re charged.

Consumer Buy to Let

This type of mortgage is for individuals who may have inherited a property or used to live in a property which is now to be rented out. It is for those who are ‘accidental landlords’ due to circumstances, rather than those who either own or wish to purchase an Investment Property for business purposes.

Investment Property Loan

This type of mortgage is especially designed for individuals who either own or wish to purchase an investment property. These include where a customer:

• uses the mortgage to purchase a property with the intention of renting it out.

• has previously purchased the property with the intention of letting it out and neither the customer nor a relative has inhabited it.

• already owns another property that has been let out on the basis of a rental agreement.