Deposit: The up front payment towards property purchase price. Starting as low as 5% of the purchase price. The more you put down the less you need to borrow.
Arrangement fee: A set-up fee for your mortgage, usually this can be added to the amount you are borrowing.
Base rate: A rate of interest set by the Bank of England. Tracker mortgages and lenders’ variable rates usually follow.
Fixed-rate mortgage: the interest rate stays the same for the period of the deal you sign up for e.g. 2 years. Each month for the term you will pay the same amount.
Tracker Rate Mortgage: the interest rate will be linked to a base rate, which it moves up and down with. Each month you will pay a variable amount depending on this base rate.
Interest Only Mortgage: Only the interest on the mortgage is paid each month which means the amount you borrowed does not reduce over the term. You will need to ensure you have a means to repay at the end of the term.
Mortgage Term: the length of time the mortgage is proposed to run.
Portable Mortgage: Your mortgage can be transferred to a new property if you decide to move in the term.
Repayment Mortgage: monthly repayments include interest and repayment of the loan. The amount you owe will reduce over time.
Mortgage in principle: An indication from a provider of how much you could borrow.