:: UK JARGON INFOGUIDE

Gazumping
This term is used to describe a seller who accepts an offer agreeing the sale of their property and then before the exchange of contracts accept a bigger offer. By this time you could have had surveys and local authority reports and lose your money.

Guarantor
If you can't borrow enough to buy the home you want someone can act to pay the rest of the mortgage. Parents may act as guarantors for their children when buying their first home. It should be remembered that a guarantor would be fully liable for repayment of the mortgage amount if a borrower defaults. The guarantor should therefore be confident that the borrower will meet all the necessary monthly payments.

Hire Purchase
This term is used to describe purchase brought on credit like cars, electrical items, furniture etc. Usually it is items brought on HP. A credit check will check to see if you have ever had or still have any HP's and the payment history of them.

Homebuyers Report
This may also be called a homebuyers survey. The report is a surveyors assessment of the state of repair and condition of the property. It covers all areas of the property that are readily accessible. The report summarises the findings and makes recommendations for investigation or proposals for work required. A detailed a structural survey report may be more suitable for some types of older properties.

Household Insurance
A term used to describe both buildings and contents insurance. Buildings insurance is likely to be a requirement of any mortgage lender.

Holiday Home
This refers to a property which is purchased for use at weekends and for holidays only. As the borrower is not living in the property all the time, mortgage lenders have stricter lending
criteria and borrowers may find that they have to put down larger deposits.

High street lenders
Providers of mortgage products who can be broadly split into two groups - the building societies and the banks. Banks are profit-making businesses that return a portion of their profits to shareholders in the way of dividends. Building societies on the other hand, are mutually owned organisations, which exist not for profit but for the benefit of the members. They claim that this allows them to return profits to their customers in the form of cheaper products.

HM Land Registry
Government organisation that keeps records of properties in England and Wales. Transfer of ownership must be registered with the HM Land Registry.

Independent
Independent Financial Advisor or an Independent Mortgage Broker. They are not attached to a specific mortgage or loan provider so they aim to get you a highly competitive deal.

Interest-only Mortgage
This works the same way an Endowment Mortgage works.

Illustration
This is a quotation given to a potential borrower to show the monthly cost of a mortgage and any other expenses incurred with the loan.

Impaired Credit
This refers to the credit rating of an individual who may have CCJs or maybe behind with payments to personal loans or a mortgage. This phrase is also applicable to someone who has
been declared bankrupt.

Introducer
A mortgage broker or adviser who introduces a borrower to a potential lender.

IFA - Independent Financial Advisor
In theory, these intermediaries should look at the entire financial market before making a selection and offer unbiased advice and access to all suitable financial products. they sometimes still have access to special deals not on offer elsewhere because they may subscribe to a mortgage panel along with other advisers and brokers. Together they convince lenders to provide special packages in return for their continued custom. The only trouble is that they have to deliver a certain level of business over a year to remain on the panel, so they may favour some products over others.

Interest rate
The is the percentage of your loan that a lender charges you each year for the privilege of borrowing money. The prevailing level of interest charged by lenders depends largely on the economy and the Bank of England base rate. If the Governor of the Bank of England and the Monetary Policy Committee are worried about the economy overheating and causing inflationary pressure, they may raise interest rates. This makes it more expensive to borrow money and therefore the overall demand for borrowing is reduced. Since this is one of the most commonly used instruments for managing the economy, we are subject to fairly frequent changes in interest rate.

ISA
Individual Savings Account.

ISA mortgage
A mortgage loan funded by contributions to an Individual Savings Account. ISAs provide tax-free growth, generated mainly by stock market investment. The ISA aims to repay the loan's capital at the end of its term, but the interest element must be cleared separately as you go along.