New Home Jargon Busting – Your Glossary for Buying a New Home

by Administrator 14. October 2014 13:00

 

Buying a new home is an exciting time but, all of the legal jargon involved in the process can be confusing and daunting. If you feel like your lawyer is speaking to you in another language, our jargon busting glossary is exactly what you need to make buying a new home easy and hassle-free.

Agreement in Principal

An agreement from a mortgage lender stating the amount they may be willing to lend you. This occurs in the very early stages of the mortgage application process and it is subject to a full mortgage application being submitted with additional supporting documents i.e. payslips, bank statements.

CML

An abbreviation which stands for the Council of Mortgage Lenders. This industry body represents mortgage lenders in the UK and oversees the lending process.

Completion

Completion is the legal transfer of ownership of your new home from the seller to the buyer.

Conveyancer  

Your conveyancer will deal with all the legal aspects of buying a new home. All conveyancers should be registered with the Council for Licensed Conveyancers.

If you are buying a new home in Scotland your conveyancer will be a solicitor. However, if you are in the process of buying a new home in England, your Conveyancer can either be a property lawyer or a licenced conveyancer.

Conveyance

This is also known as Transfer. This is the legally binding document that transfers the ownership of the property from the seller to the buyer.

Deeds

A legal document which proves ownership of the home.

Deposit

The deposit is part of the purchase price of the property. It’s separate to the deposit for your mortgage and you will usually be required to pay this when you sign the missives if you’re buying a new home in Scotland or once you sign the contract in England.

Disbursements

These are out-of-pocket fees that your solicitor / licenced conveyancer will pay on your behalf. This can include payments for fees such as Stamp Duty, land registry, etc.

Equity

The equity is what you actually own of your home. It’s the difference between the market value and the amount of the loan you owe your mortgage provider.

Freehold

This term means that you own the property as well as the land it’s built on for an unlimited period of time.

FCA

The FCA (Financial Conduct Authority) is an independent body that provides consumer protection within the financial market.

Land Registry

This is a government office that stores records of landownership and charges on properties such as the mortgage.

Land Registry Fees

A fee paid to the Land Registry office to register ownership of your home. This fee will be paid on your behalf by your conveyancing lawyer.

Local Authority Search

This is a method of checking for factors which may affect the market value of the property. The Local Authority Search covers enquiries made by your solicitor regarding proposed planning applications or traffic schemes in the surrounding area. Remember, this won’t cover planning applications submitted for nearby properties.

Mortgage

A loan which helps to pay for your home. Your mortgage provider will hold the deeds to your new home until you have repaid the mortgage in full.

Mortgage Deed

The Mortgage Deed is a legally binding document which gives your mortgage lender a legal right to the property until your mortgage is repaid in full

NHBC Guarantee

A guarantee from the National House Building Council (NHBC) for new homes. This guarantee covers structural defects for a given timeframe.

When you move into your perfect new home from Stewart Milne Homes you can enjoy the peace of mind that comes from knowing you are covered by a NHBC 10 year Buildmark Warranty.

Off-Plan

This is when a homebuyer purchases a new home before it has been built after viewing the floor plans and in some cases, an artist’s impression.

Reservation Fee

Once you pay the reservation fee your future home will be removed from the market. You will be liable to pay this once you have agreed with the builder to purchase a specific plot. This amount will be deducted from the overall cost of the property.

Stamp Duty

A government tax which is payable on all properties that are valued over £125,000. The amount due depends on the total market value of the property.

Tenure

This is the legal term in which your ownership of the property is defined i.e. freehold.

Valuation Survey

A valuation survey determines the value of the property for the purposes of your mortgage. This survey will affect the amount your lender will allow you to borrow for your desired home.

Let us help you find the perfect new home. Browse Stewart Milne Homes’ collection of new homes online today.

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