Property Buying Jargon Buster: A-Z Guide

The property buying process is packed with jargon. This comprehensive alphabetical glossary explains every term you are likely to encounter, from your first mortgage application to completion day and beyond.

10 min read

A

Abstract of title: A summary of the documents and events that prove ownership of a property. In registered land (the vast majority in England and Wales), the Land Registry title register has largely replaced abstracts, but the term still appears in older conveyancing documents.
Acceptance: The point at which a seller formally agrees to a buyer's offer. In England and Wales, acceptance is not legally binding until contracts are exchanged. In Scotland, a concluded missive is legally binding.
Agreement in principle (AIP): A statement from a mortgage lender confirming how much they would be willing to lend you, based on an initial assessment of your income and credit history. Also called a decision in principle (DIP) or mortgage in principle. Not a binding offer but shows sellers and agents you are a serious buyer.
Asking price: The price at which a property is marketed. Not necessarily what the seller expects to achieve -- it may be set high to leave room for negotiation, or low to encourage competitive bidding.

B

Base rate: The interest rate set by the Bank of England, which influences the rates that mortgage lenders charge. When the base rate rises, variable and tracker mortgage rates typically rise too. Fixed rates are influenced by swap rates rather than the base rate directly.
Bridging loan: A short-term loan (typically 3-18 months) used to bridge the gap between buying a new property and selling an existing one. Interest rates are higher than standard mortgages. Useful when a chain breaks or at auction.
Building survey (Level 3): The most comprehensive type of property survey, suitable for older, larger or unusual properties. Includes a detailed inspection of the structure, advice on defects, repairs and maintenance. Previously known as a full structural survey.
Buildings insurance: Insurance that covers the cost of rebuilding or repairing the structure of the property if it is damaged by fire, flood, subsidence or other insured events. Mortgage lenders require buildings insurance as a condition of lending. Cover should be for the rebuild cost, not the market value.

C

Chain: A sequence of linked property transactions where each buyer is also a seller (except at the top and bottom). A chain of four might be: first-time buyer purchases from someone who purchases from someone else, who purchases from a person moving into rented accommodation. Chains can cause delays and are a common source of failed transactions.
Chancel repair liability: A historic obligation that requires some property owners to contribute to the repair of the local Church of England parish church chancel. Your conveyancer will check whether the property is affected and may recommend chancel repair liability insurance.
Completion: The final stage of the purchase when the buyer's solicitor transfers the purchase funds, the seller's solicitor confirms receipt, and the keys are handed over. The property legally changes hands on the completion date.
Completion statement: A financial statement prepared by your solicitor showing all the money due on completion: the purchase price, minus the deposit already paid, plus fees, stamp duty, and any adjustments. You must transfer this amount to your solicitor before completion day.
Conditions of sale: The terms set out in the contract between buyer and seller, covering matters such as the completion date, what is included in the sale (fixtures and fittings), and any special conditions.
Contract: The legal agreement between buyer and seller. In England and Wales, the contract becomes binding only when both parties have signed identical copies and exchanged them through their solicitors.
Conveyancer / Conveyancing: A conveyancer is a qualified legal professional (a solicitor or licensed conveyancer) who handles the legal transfer of property ownership. Conveyancing is the process itself -- it covers title checks, searches, drafting contracts, handling funds and registering the purchase with the Land Registry.
Council tax band: Every domestic property in England and Wales is assigned a council tax band (A to H in England, A to I in Wales) based on its estimated value in April 1991. The band determines how much council tax the occupier pays. You can check the band on the Valuation Office Agency website.
Covenant: A binding condition attached to the property's title. Restrictive covenants limit what you can do with the property (for example, no business use or no extensions). Positive covenants require you to do something (for example, maintain a boundary fence). Covenants can affect your plans, so your conveyancer should review them carefully.

D

Decision in principle (DIP): See Agreement in principle (AIP). The terms are used interchangeably by different lenders.
Deed of transfer (TR1): The legal document that transfers ownership of registered land from seller to buyer. Your conveyancer prepares this and it is signed at or before completion.
Deposit: The upfront money you put towards the purchase. The exchange deposit (typically 10% of the purchase price) is paid when contracts are exchanged and is non-refundable if you pull out. Your mortgage deposit is the difference between the purchase price and the mortgage amount.
Disbursements: Third-party costs that your conveyancer pays on your behalf, such as search fees, Land Registry fees, and stamp duty. These are itemised separately from your conveyancer's own fees.

E

Early repayment charge (ERC): A fee charged by your mortgage lender if you repay the mortgage (or overpay beyond allowed limits) during a fixed or discounted rate period. Typically 1-5% of the outstanding balance, decreasing each year.
Easement: A right that someone else has over your land, such as a right of way across it or a right to run drainage pipes beneath it. Easements are recorded on the title and pass with the land when it is sold.
Endowment mortgage: A type of interest-only mortgage linked to an endowment life insurance policy that was intended to repay the capital at the end of the term. Widely sold in the 1980s and 1990s, many endowment policies fell short of their targets. Rarely offered today.
Energy Performance Certificate (EPC): A legal requirement for any property being sold or let. Rates the property's energy efficiency from A (most efficient) to G (least efficient) and includes estimated running costs and recommended improvements. Valid for 10 years. See our full EPC glossary for detailed term definitions.
Equity: The portion of the property's value that you own outright -- the market value minus any outstanding mortgage. If your home is worth 300,000 pounds and you owe 200,000 pounds, your equity is 100,000 pounds.
Exchange of contracts: The point at which the sale becomes legally binding. Both buyer and seller sign identical contracts, which are then swapped by their solicitors. The buyer pays the exchange deposit. After exchange, pulling out typically means forfeiting the deposit (buyer) or paying compensation (seller).

F

First-time buyer: A person who has never owned a residential property anywhere in the world. First-time buyers may qualify for stamp duty relief, Help to Buy ISA bonuses, Lifetime ISA bonuses, and certain government-backed schemes.
Fixed-rate mortgage: A mortgage where the interest rate is locked for a set period (commonly 2, 3, 5 or 10 years). Monthly payments stay the same regardless of changes to the Bank of England base rate. After the fixed period ends, the rate typically reverts to the lender's standard variable rate.
Fixtures and fittings: Items attached to the property (fixtures, such as a fitted kitchen) and items not attached but included or excluded from the sale (fittings, such as curtains or freestanding appliances). The TA10 form lists what is included.
Freehold: Outright ownership of the land and the building on it, with no time limit. Most houses are freehold. The owner is responsible for all maintenance and can make alterations subject to planning permission and building regulations.

G

Gazumping: When a seller accepts a higher offer from another buyer after already accepting yours. Legal in England and Wales because acceptance is not binding until exchange of contracts. Less common in Scotland, where the system works differently.
Gazundering: When a buyer reduces their offer at the last moment, typically just before exchange of contracts, knowing the seller is under pressure to proceed. The reverse of gazumping.
Ground rent: An annual charge paid by a leaseholder to the freeholder. Under the Leasehold Reform (Ground Rent) Act 2022, ground rent on most new residential leases granted from 30 June 2022 is capped at one peppercorn (effectively zero).
Guarantor: A person (usually a parent or close relative) who agrees to make mortgage payments if the borrower cannot. Some lenders offer guarantor mortgages to help buyers who would not qualify on their own income.

H

Help to Buy ISA: A savings account (no longer open to new applicants) where the government adds a 25% bonus on savings up to 12,000 pounds for first-time buyers. The bonus is paid on completion. Replaced by the Lifetime ISA.
HomeBuyer Report (Level 2): A mid-level property survey suitable for conventional properties in reasonable condition. Covers the condition of accessible elements, highlights significant problems, and provides a valuation. Less detailed than a Building Survey (Level 3).

I

Indemnity insurance: A one-off insurance policy that covers a specific legal risk identified during conveyancing, such as a missing planning permission, a defective title covenant, or the absence of a building regulations sign-off. Cheaper and faster than resolving the underlying issue.
Interest-only mortgage: A mortgage where monthly payments cover only the interest, not the capital. The original loan amount must be repaid in full at the end of the term. Requires a credible repayment strategy (savings, investments, sale of another property).

J

Joint tenants: A way for two or more people to own property together where each has an equal share and, if one owner dies, their share automatically passes to the surviving owner(s). The alternative is tenants in common.

L

Land Registry: HM Land Registry is the government body that records ownership of land and property in England and Wales. When you buy a property, your conveyancer registers you as the new owner. The title register and title plan are the official record of ownership.
Leasehold: Ownership of a property for a fixed period under the terms of a lease granted by the freeholder. Common for flats. The lease specifies the length (e.g. 99 or 125 years), ground rent, service charges and obligations. A short lease (below 80 years) can affect mortgage eligibility and property value.
Lifetime ISA (LISA): A savings account for 18-39 year olds where the government adds a 25% bonus on contributions up to 4,000 pounds per year. Can be used towards a first home worth up to 450,000 pounds or for retirement after age 60.
Listed building: A building of special architectural or historic interest, listed by Historic England (or the equivalent body in Wales and Scotland). Listed building consent is required for any work that affects its character, which can limit alterations and increase maintenance costs.
Loan to value (LTV): The mortgage amount as a percentage of the property's value. A 240,000-pound mortgage on a 300,000-pound property is 80% LTV. Lower LTV generally means better interest rates because the lender takes on less risk.
Local authority search: A search carried out by your conveyancer with the local council to check for planning applications, road schemes, tree preservation orders, conservation areas, contaminated land and other factors that could affect the property. One of the standard pre-exchange searches.

M

Mortgage offer: The formal, binding offer from a lender confirming the loan amount, interest rate, term and conditions. Issued after the lender has completed its valuation and underwriting. Typically valid for 3-6 months.
Mortgage valuation: A basic assessment carried out on behalf of the mortgage lender to confirm the property is worth enough to secure the loan. Not a survey -- it does not check for defects. The buyer usually pays the fee, though some lenders include it for free.

N

Negative equity: When the outstanding mortgage is greater than the property's current market value. This can happen if prices fall after purchase. It does not affect your ability to stay in the property but makes selling or remortgaging difficult.
New-build: A property that has never been occupied. New-builds often come with an NHBC or similar warranty covering structural defects for 10 years. They typically have high EPC ratings but may command a premium over equivalent second-hand properties.

O

Offer: A formal proposal to buy a property at a stated price, usually made through the estate agent. In England and Wales, an accepted offer is not legally binding until exchange of contracts. Offers are typically made "subject to contract and survey".
Ombudsman: An independent body that resolves complaints between consumers and businesses. The Property Ombudsman handles complaints about estate agents. The Legal Ombudsman handles complaints about solicitors and conveyancers.
Overpayment: Paying more than the required monthly mortgage amount to reduce the outstanding balance faster and save on interest. Most mortgages allow overpayments of up to 10% of the balance per year without an early repayment charge.

P

Planning permission: Formal approval from the local planning authority to carry out development or change the use of land or buildings. Some minor works fall under permitted development rights and do not need planning permission. Always check before starting work.
Property information form (TA6): A standard form completed by the seller providing information about the property, including boundaries, disputes, planning issues, guarantees, flooding history, environmental matters and more. Reviewed by the buyer's conveyancer as part of due diligence.

R

Redemption: Paying off a mortgage in full. Your lender will provide a redemption statement showing the exact amount needed, including any early repayment charges and accrued interest.
Remortgage: Replacing your existing mortgage with a new one, either with the same lender or a different one, typically to secure a better interest rate or release equity. Common when a fixed rate period ends.
Repayment mortgage: A mortgage where each monthly payment covers both interest and a portion of the capital. By the end of the term, the entire loan is repaid. The most common type of residential mortgage.
Retention: When a mortgage lender withholds part of the loan until specific repairs or works are completed. For example, if the survey reveals a roof defect, the lender may retain funds until the roof is fixed.
Right of way: A legal right to pass over someone else's land. A right of way affecting the property you are buying may allow neighbours to cross the garden or driveway. Your conveyancer will check for these as part of the title review.

S

Searches: Enquiries made by your conveyancer before exchange of contracts to uncover potential issues. Standard searches include local authority, environmental (including flood risk), water and drainage, and chancel repair. Results can take 1-6 weeks depending on the council.
Service charge: A regular payment made by leaseholders to cover the cost of maintaining communal areas, building insurance, and management of the block. Varies widely -- always ask for at least three years of accounts before buying a leasehold property.
Shared ownership: A government-backed scheme where you buy a share of a property (typically 25-75%) and pay rent on the remainder. You can buy additional shares over time (staircasing) until you own it outright.
Solicitor: A qualified legal professional who can handle all aspects of a property transaction. In the context of buying a home, your solicitor carries out conveyancing, reviews the contract, conducts searches, handles funds and registers your ownership.
Stamp duty (SDLT): Stamp Duty Land Tax is a tax paid by the buyer on property purchases in England and Northern Ireland above certain thresholds. Rates increase in bands as the price rises. First-time buyers benefit from higher thresholds. Scotland has LBTT and Wales has LTT -- similar taxes with different rates.
Standard variable rate (SVR): The default mortgage interest rate set by each lender. You typically move onto the SVR when a fixed, tracker or discounted deal ends. SVRs are usually higher than deal rates, so most borrowers remortgage before their deal expires.
Subject to contract: A phrase used in England and Wales meaning the agreement is not legally binding until contracts are formally exchanged. All negotiations and accepted offers before exchange are "subject to contract".
Subsidence: Downward movement of the ground beneath a building's foundations, causing structural damage. Common causes include clay soil shrinkage, tree roots and mining. A history of subsidence can affect insurance and mortgage eligibility.
Survey: An inspection of a property by a qualified surveyor. The three main levels are: Level 1 (Condition Report -- basic), Level 2 (HomeBuyer Report -- standard), and Level 3 (Building Survey -- comprehensive). Not the same as the mortgage lender's valuation.

T

Tenants in common: A way for two or more people to own property together where each holds a specified share (not necessarily equal). If one owner dies, their share passes according to their will or intestacy rules, not automatically to the surviving owner(s). Compare with joint tenants.
Title: The legal evidence of a person's ownership of a property. The title register (held at the Land Registry) shows who owns the property, the address, any mortgages, and any restrictions or rights affecting it.
Title insurance: An insurance policy that protects against financial loss from defects in the title that were not discovered during conveyancing. More common in new-build purchases and buy-to-let transactions.
Tracker mortgage: A variable-rate mortgage that tracks the Bank of England base rate at a set margin. If the base rate is 4.5% and the tracker is base rate plus 1%, the mortgage rate is 5.5%. Payments move up or down as the base rate changes.
Transfer deed (TR1): See Deed of transfer. The official form used to transfer registered land from seller to buyer.
Tree Preservation Order (TPO): An order made by the local planning authority to protect specific trees or groups of trees. It is a criminal offence to cut down, top, lop or uproot a protected tree without consent. Your conveyancer checks for TPOs in the local authority search.

U

Under offer: A property status indicating the seller has accepted an offer but contracts have not yet been exchanged. The sale is not legally binding at this stage. Also referred to as "sold subject to contract" (SSTC).

V

Valuation: An assessment of a property's market value. The mortgage lender carries out a valuation to ensure the property is adequate security for the loan. Independent valuations are also used for probate, divorce and tax purposes.
Variable-rate mortgage: A mortgage where the interest rate can change over time. Includes tracker mortgages, discount mortgages and the lender's standard variable rate. Monthly payments can go up or down.
Vendor: The legal term for the person selling a property. In everyday use, "seller" is more common.

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