40 reviewed definitions

UK mortgage glossary

Mortgage language translated into plain English. Each definition includes a practical example, why the term matters, and a link to an authoritative source.

Applications and affordability

9 terms

Agreement in Principle (AIP): A provisional indication of what a lender might be prepared to lend.
County Court Judgment (CCJ): A court judgment in England or Wales recording that money is owed.
Debt Management Plan (DMP): An informal arrangement to repay qualifying non-priority debts at an affordable rate.
Deposit: The part of a property price not funded by the mortgage advance.
Individual Voluntary Arrangement (IVA): A formal insolvency agreement to repay creditors under agreed terms.
Loan-to-Value (LTV): The mortgage balance expressed as a percentage of the property's value.
Notice of Correction (NoC): A short statement added to a credit report to explain an entry.
SA302 Tax Calculation: An HMRC tax-calculation document used as evidence of declared self-employed income.
Mortgage Affordability Stress Test: A lender check of whether repayments remain affordable under less favourable assumptions.

Rates, repayments and fees

13 terms

Amortisation: The way a repayment mortgage balance reduces through scheduled payments.
Annual Percentage Rate of Charge (APRC): A standardised annual measure of mortgage cost, including specified fees and assumptions.
Arrangement Fee: A lender charge associated with a particular mortgage product.
Early Repayment Charge (ERC): A charge that may apply when repaying or switching a mortgage during a specified period.
Fixed-Rate Mortgage: A mortgage deal whose interest rate is fixed for a stated period.
Interest-Only Mortgage: A mortgage where scheduled payments do not repay the capital balance.
Offset Mortgage: A mortgage linked to savings that reduce the balance used to calculate interest.
Mortgage Overpayment: Paying more than the required mortgage payment to reduce the balance sooner.
Porting a Mortgage: Applying to transfer an existing mortgage product to a different property.
Product Transfer: Moving to another mortgage product with the existing lender.
Remortgage: Replacing an existing mortgage with a new mortgage, usually from another lender.
Standard Variable Rate (SVR): A variable mortgage rate set by the lender, often used after an introductory deal ends.
Tracker Mortgage: A variable-rate mortgage linked to a stated reference rate plus or minus a margin.

Buying and legal process

4 terms

Completion: The legal stage when purchase funds transfer and ownership changes.
Conveyancing: The legal work required to transfer property ownership and register the lender's security.
Exchange of Contracts: The stage when a purchase becomes legally binding in England, Wales and Northern Ireland.
Gifted Deposit: Deposit money given without an agreement that the buyer will repay it.

Buy-to-let

3 terms

Buy-to-Let (BTL): A mortgage for a property intended to be rented to tenants.
House in Multiple Occupation (HMO): A property occupied by people from more than one household who share facilities.
Interest Coverage Ratio (ICR): A buy-to-let test comparing expected rent with stressed mortgage interest.

Tax and home-buying schemes

8 terms

Help to Buy Equity Loan: A closed government equity-loan programme; existing loans continue under their terms.
Joint Borrower Sole Proprietor (JBSP): A mortgage with multiple borrowers but fewer legal owners.
Land and Buildings Transaction Tax (LBTT): The Scottish tax on qualifying land and property transactions.
Lifetime ISA (LISA): A savings account with a government bonus that can be used for an eligible first-home purchase.
Land Transaction Tax (LTT): The Welsh tax on qualifying land and property transactions.
Mortgage Guarantee Scheme (MGS): A permanent UK government guarantee supporting participating lenders' 91-95% LTV mortgages.
Stamp Duty Land Tax (SDLT): The transaction tax on qualifying land and property purchases in England and Northern Ireland.
Shared Ownership: A scheme where a buyer purchases a share of a home and pays rent on the remainder.

Regulation and consumer protection

3 terms

Financial Conduct Authority (FCA): The UK regulator for financial markets and firms carrying on regulated activities.
Financial Ombudsman Service (FOS): An independent service that considers eligible complaints about financial businesses.
Information Commissioner's Office (ICO): The UK's independent regulator for data-protection and information-rights law.

How this glossary is maintained

Definitions are checked against primary consumer and regulatory sources. Product criteria, tax rules and scheme terms can change, so a glossary definition is general information rather than advice for a specific mortgage application.

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