Javascript is vital for the advanced features in this website such as Property Search. Please enable or upgrade your browser

Jargon Buster

Tom Henry & Co Property Jargon Guide:

Property can be a complicated topic, so check our glossary below for any words or terms you might not understand.

Application Fee – Cost involved in processing a mortgage or rental application, paid by the buyer to the lender or the tenant to the agent.

Annual Percentage Rate (APR) – Total cost of the loan over the entire term, to include interest and fees, shown as a percentage rate. The APR is intended to help you compare different types of mortgages from different lenders.

Applicant – person or party seeking to rent a property or applying for a mortgage.

Appraised value – estimated value of a property by a surveyor at a given point in time.

Appreciation – increase in the value of a property due to market conditions.

Auction – public sale in which a property is sold to the highest bidder.

Break Clause – a term in a tenancy agreement/lease which enables the landlord or tenant to end the lease early, usually without incurring a financial penalty. (Commonly found in commercial leases).  

Bridging Loan - a short-term loan used to cover an interval between two transactions (typically the buying of one house and the selling of another). 

Building Survey – a detailed type of survey that is completed by a Chartered Surveyor, arranged by the buyer. Normally undertaken if buying an older property, one which needs substantial refurbishment or where there have been structural problems in the past. The report provides and analysis of the property's condition and includes advice on defects, repairs and maintenance options.

Buy-to-Let Mortgage – A mortgage specifically designed for investors with which to purchase property to let/rent to tenants in the private rented sector.

– AKA equity: the amount of money/ deposit put down when buying a property.

Chain – when a buyer is dependent upon completion of the sale of their existing property in order to complete on the purchase of a new property and so on in a sequence of linked house purchases.

Commission – the sum paid to the agent for business undertaken.

Common Areas – areas available for use by more than one resident/tenant e.g. driveways, gardens, corridors, stairways, elevators.

Completion date – a contractually bound date agreed between buyer and seller, where the buyer receives the keys to their new property and the money is forwarded to the seller’s solicitor.

Conditions of Sale – contractual obligations between buyer and seller.

Contract – legal agreement between the buyer and seller prepared by a solicitor, detailing the terms and conditions of the sale. Also another name for a lease between a landlord & tenant.

Conveyancing – the transfer of legal title/ownership of property from one party to another.

Covenants – conditions governing the property, contained in the title deeds or lease.

Credit Score – a numerical score based on a person's individual circumstances/creditworthiness. Lenders use credit scores to determine who qualifies for a loan/mortgage, at what interest rate and how much they are willing to lend.

Deeds – a formal document that confirms or transfers interest or right of ownership of a property from one person to another.

Deflation – decrease in the general price level of property.

Deposit – a returnable sum of money paid to cover possible loss or damage, paid to the landlord by the tenant prior to moving in.

Depreciation - a reduction in value of a property over a period of time.

Dilapidations – damage to a property which the tenant is responsible for repairing as part of their lease.

Down valuation – whereby a surveyor undervalues a property and the lender restricts amount you can borrow.

Draft contract – initial version of the contract drawn up before final version is agreed.

Energy Performance Certificate (EPC) – introduced to improve the energy efficiency of buildings, measured on a A-G scale. With ‘A’ being the most energy efficient and ‘G’ being the least. If you are buying or selling a home you now need a certificate by law.

Equity – the difference between the market value and the unpaid mortgage balance of a property. This may be a positive or negative figure.

Exchange of Contracts – when the contracts have been signed and physically exchanged, committing both the buyer and seller to this legally binding agreement.

Financial Services Authority (FSA) – regulator of all providers of financial services in the UK.

Freehold – ownership of the land in addition to the buildings on that land.

Gas Safety Regulations 1998
– before any tenancy or lease commences it must be ensured that a gas safety check has been carried out on each appliance by a CORGI registered engineer.

Gazumping – refusal to formalise a property sale agreement at the last minute, usually in order to accept a higher offer.

Gazundering – occurs during contract negotiation when the buyer demands a reduction in the sale price of the property leaving the vendor to decide whether to accept the low offer or let the sale fall through.

Ground Rent – regular payment required under the terms of a lease by the owner of a building to the owner of the land on which it is built.

Guarantor – person appointed, on requirement by the lender, who assumes responsibility to pay the debt if the borrower defaults. Can also be a person appointed to pay rent if the tenant fails to do so.

Homebuyer’s survey and valuation – detailed report carried out by a Chartered Surveyor assessing the state/condition of a property and it's value.

House in Multiple Occupancy (HMO) – a property rented out by at least 3 people who are not from one 'household' (e.g. a family) but share facilities such as the kitchen and bathroom.

IFA – Independent Financial Advisor.

Inflation – increase in the general price level of property.

Inventory – a binding legal document that provides an accurate written record of the condition and contents of a property at the beginning of a tenancy. It will serve as a check list when ending the tenancy should a dispute arise as to the condition of the contents.

Joint Agency – when two agents agree to market a property together and split the commission.

Joint Tenants – a tenancy agreement whereby one tenant has a right of survivorship to the property upon the death of the other tenant, giving them full ownership.

Land Certificate – certificate issued by Land Registry giving details of who owns the land/evidence of ownership.

Land Registration – registering the legal title of an area of land, applicable to a fee.

Landlord – a person who leases land or property.

Lease – a legal contract by which one party conveys land or property to another for a specified time, in return for payment.

Leasehold – the holding of a property/land by lease.

Lender – a party/financial organisation offering a loan e.g. bank, building society or mortgage company, applicable to a lending fee.

Let-to-Buy Mortgage – allows you to borrow money to buy a new home to move into, while your existing residence is let out to tenants.

Listed Building – building that has certain characteristics related to age, rarity, architectural merit and/ or method of construction. A listed building cannot be demolished, extended or altered without special permission from the local planning authority.

Loan to value (LTV) – calculated percentage of the mortgage loan to the value of the property/asset purchased.

Local Authority Search – a checking procedure with the local council to obtain information on any charges, responsibilities or future developments you will be taking on when exchanging contracts.

Maintenance Charge – also known as service charge, covering the cost of repairing and maintaining the external and/or internal parts of a communal building, payable to the landlord.

Marketing Package – effective package aimed at marketing the property for sale, to include boards, brochures, newspaper advertisements, photographs etc.

Money Laundering – financial crime of processing illegally gained money.

Mortgage – a long term loan secured by a property title and paid in instalments over a set period of time to the lender.

Mortgage Broker – a person/company who arranges a mortgage between borrowers and lenders. 

Mortgage deed – a document which gives a lender the legal right and interest in a property.

Mortgage offer – written offer confirming the mortgage lender will lend money on the property and containing all terms and conditions of the loan.

Mortgage rate – the interest rate charged by a mortgage lender.

Mortgage term – the period of time the mortgage has legal effect. After this term the mortgage must be repaid or renewed. 

NHBC Scheme (National House-Building Council) – standard setting body for new and newly converted homes in the UK.

Negative Equity – if the value of your property falls below the amount you owe on your mortgage.

Offer – fundamental part of a contract, whereby the tenant offers to pay a sum of money as rent to the landlord, or whereby a buyer offers a sum of money to purchase property from the seller.

Open market value – best price which is reasonably expected to be obtained for an interest in a property, between a buyer and seller.

Pied a terre – a property used for occasional or secondary lodging.

Remortgage – moving your mortgage to a new lender mainly to take advantage of a better mortgage rate. Or to raise money by borrowing against equity.

Repossession – where the lender reclaims ownership of the property when the owner defaults on payments.

Right-to-Buy – allows council house tenants to buy their property if they are eligible.

Sale Agreed - The status of a property for sale, when the vendor has verbally accepted an offer from a buyer but contracts have not yet been exchanged.

Semi-Detached – A pair of houses joined by a common wall.

Service Charge - also known as maintenance charge, covering the cost of repairing and maintaining the external and/or internal parts of a communal building, payable to the landlord.

Sitting Tenant - A tenant already in occupation/who remains in occupation of premises when there is a change of owner.

Sole Agent – When only one agent is authorised to sell a property.

Solicitor - A member of the legal profession who will handle all documentation for the sale or purchase of a property.

Stamp Duty – A tax paid by the purchaser of a property which is calculated depending on the value of the property.

Structural survey - A thorough examination of a property by a qualified surveyor.

Studio Flat - A flat consisting of one main room or open-plan living area incorporating cooking and sleeping facilities and a separate bathroom/shower room.

Subject to Contract – The period during which the sale is agreed but there is not yet a legal contract.

Survey – An inspection on a property carried out by a qualified surveyor.

Surveyor – Professional person qualified to undertake a survey of a property and estimate value.

Tenancy – Occupancy of a property by a tenant for fixed period of time.

Tenancy Agreement - A tenancy agreement is a legal agreement in writing that sets out the rights and responsibilities of both landlord and tenant. It will contain details such as the length of the agreement, the rent payable, and what is and isn’t allowed in the property, such as pets.

Tenant – a person who occupies land or property rented from a landlord. 

Terraced house – A style of property that is one in a row of similar properties joined together by their side walls.

The Property Ombudsman (TPO) – A UK government approved organisation which aims to provide better consumer protection for home buyers and sellers, landlords and tenants.

Title Deeds – Documents showing ownership, as well as rights, obligations or mortgages on the property.

Title Insurance – An insurance policy taken out by a purchaser of a property to indemnify loss or damage resulting from defects or problems relating to the ownership of the property or from the liens that exist against it.

Title search – A process that is performed to determine if there are any restrictions or allowances on the use of land and if any liens exist on the property.

Transfer Deeds – A document used to transfer a property from its legal owner to another party.

Under offer – A property that has an offer accepted by the vendor but contracts have yet to be exchanged.

Valuation – Appraisal of the value of a property.

Vendor – person selling a property.

Verbal offer – offer made on a property that is not legal binding.

Yield – income generated from a property, normally shown as a percentage.