Early Repayment Charges
These are applied to a mortgage should you repay the mortgage, normally, during the period in which you have a “deal”. For example if you take a 3 year fixed rate mortgage then the lender will have a clause in the mortgage agreement that if you repay the mortgage early (or a proportion of the mortgage) then a penalty will be charged, this is often charged as a percentage of the mortgage balance.
Usually once the “deal” is over then the penalties will no longer apply. It is important to understand this area of your mortgage agreement so that you do not end up paying penalties when you were not expecting them.
Also known as Redemption Penalties.
How much money you will be putting down over and above the mortgage amount towards the value of your home. Deposit does imply you will get this money back however you must be aware that house prices can go down and therefore you may not get back all you put in.
Loan to Value (LTV)
This will be expressed as a percentage and it is how much you are borrowing in comparison to the property value. So, for example, if you need a mortgage of three quarters the property value you will be taking a 75% LTV Mortgage.
Bank of England
The home of the Monetary Policy Committee (MPC) who set the base rate each month and initiate financial (fiscal) policy. For more detailed information click here. Particularly important if you have a tracker mortgage.
Financial Conduct Authority
The regulator of the financial services industry in the UK
Energy Performance Certificate (E.P.C.)
A report carried out when you sell your home and will give you a current energy efficiency rating and a potential energy efficiency rating. The graph produced is similar in appearance to the energy efficiency graphs seen on new fridges and washing machines.
Where the customer specifically requests a product and therefore does not want advice. FCA describe it as: “Consumers must know precise details of the product and the loan they require in order to proceed.”
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.