Stuck on some mortgage jargon? Use this handy guide from our partners at Nationwide to sort your APRs from your Variable fees.
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Add fee to loan
You can add the product fee to the loan and spread the cost over the remaining term of the mortgage. If you choose this option the fee will be added to the mortgage balance and attract interest for the term of the mortgage.
Sometimes called a further advance. This is the term used when an existing mortgage customer wishes to increase their mortgage borrowing, which can be done 6 months after the main mortgage loan has completed. Additional borrowing is often used to fund home improvements but can be taken for any purpose (except capital raising).
Annual Percentage Rate (APR)
The Annual Percentage Rate (APR) is the total cost of a loan taking into account all charges, including interest payments, arrangement fees etc. This can be used to compare the cost of different mortgages on offer from different lenders.
An account is defined as being in arrears when the due date has passed and payment for that month has not been made.Arrears Fees
These are fees that are charged when an account is in arrears. Any charges applied will be added to your mortgage account and interest will be charged on them.Capital & interest mortgage
See 'Repayment (Capital and Interest) mortgage'.Daily Interest
With some providers, including Nationwide, your interest is calculated daily, which means you only pay interest on what you owe.Equity
The monetary difference between the value of a property and the mortgage loan held against that property.
Extended Tie in
Many lenders require that you stay with them for a certain period after your deal ends. Nationwide do not charge extended tie-ins on any deal.First Time Buyer
A person buying their first property.
Fixed Rate Mortgage
A fixed rate mortgage provides the security of fixed mortgage repayments until the end of the deal period, no matter what happens to interest rates.Higher Lending Charge
Some lenders impose a Higher Lending Charge if you only have a small deposit. Nationwide does not.
A person selling one property and purchasing another property.Interest only mortgage
With interest only mortgages, your monthly payments only cover the interest on the amount you owe (so you're not reducing the outstanding sum each month).
You will need to put additional money aside to repay your mortgage at the end of the term, for example into an investment such as an endowment policy or ISA. Find out more about interest only mortgages
from Nationwide.Interest Rate
This is the rate at which the lender calculates the interest they charge the borrower for the mortgage, expressed as a percentage.Legal Costs
Moving your mortgage usually results in legal costs, for which your provider may or may not pay. Costs are not typically covered including mining or any other unusual search fees, fees for the first registration of the title at HM Land Registry , dealing with a change of name on the title deeds or a transfer of equity and any additional legal work needed to put your title deeds in order. For more information, please see 'Fees and Charges'
within the 'Important Information'
section on the Nationwide website.Loan to Value (LTV)
The loan to value represents the amount you are looking to borrow (or the remaining amount of your existing mortgage) as a percentage of the value of the property. For example, if a property is valued at £100,000 and you have a £80,000 loan, the LTV is 80% (80,000/100,000 x 100 = 80%).Mortgage Exit Administration Fees
See 'Redemption charge'New Build Property
The definition of a 'new build' means a property that has not been occupied within two years of being newly constructed, converted or refurbished.
No Extended tie-ins
You won't be tied-in to any extended Early Repayment Charges.Overpayments
Some lenders, including Nationwide, allow you to pay more than your required minimum monthly payment and build up an overpayment reserve. This enables you to pay off your mortgage earlier or make underpayments in the future (conditions will apply).Part and part mortgage
Part and part mortgage deals allow you to combine elements of both repayment and interest only mortgage deals.
To be considered a Permanent Resident, you must have Indefinite leave to remain in the UK and you should consider the UK as your home.
Many mortgage products are "portable" which means that they may be transferred from one property to another when you sell one property and buy another (terms and conditions apply).
A fee charged on some mortgages to secure a particular mortgage deal. For mortgages reserved on or before 3rd March 2010, this was known as a reservation fee.
When you apply for a mortgage you may be asked to pay a valuation fee to cover the cost of valuing your property. The valuation fee is payable prior to valuation and is non-refundable if the valuation is carried out. The valuation is very basic and is carried out for the provider's benefit. We strongly recommend that you have a more thorough survey undertaken, such as a homebuyers report. This will tell you about the quality and condition of the house you want to buy. There is an additional fee for this service, which can be arranged through your provider. Get details of valuation fees
with Nationwide.Where the property valuation figure differs from the purchase price:
Once you have submitted your application and the property valuation has been carried out, the provider's lending decision and your product eligibility will be based on whichever is lower of the purchase price or property valuation. However, there are some exceptions, so if you are looking for a shared equity or shared ownership mortgage, or if you are purchasing a property at significantly below its market value from a family member/employer/landlord. It is best to speak to an advisor.Redemption Charge
If you enter into a new mortgage and subsequently repay your mortgage more than ten years before the natural term, you will pay a charge (currently £90 with Nationwide). Some providers, including Nationwide, will waive this fee if you take out a new mortgage with them.
When a person transfers their mortgage from another lender.
Repayment (capital & interest) mortgage
With a Repayment (capital and interest) mortgage you repay both the interest and a small percentage of the borrowed capital each month. That means that your mortgage will be paid off in full (if you continue to meet your payments) at the end of the mortgage term.Reservation Fee
See Product Fee.Switching
When a customer comes off one mortgage deal and moves to a new mortgage deal with the same lender.Telegraphic Transfer fee
If you or your conveyancer request money to be sent by telegraphic transfer when your mortgage completes, a fee may be charged. With Nationwide, this is £25.
Tracker mortgages often have a lower limit called a tracker floor or a collar. This means that if the Bank rate falls past this point, any cut will not be passed on to customers.
Tracker Rate Mortgage
With a tracker mortgage, the interest rate you are charged tracks the Bank of England's (BoE) base rate up and down by an agreed percentage. Thus your payments will go up and down in line with the rate changes, except where the BoE base rate goes below the tracker floor.Underpayments
Some lenders, including Nationwide, will let you use an overpayment reserve. You can use any overpayment reserve you have built up to reduce your monthly mortgage payments (underpay) in the future. (conditions apply).Valuation Fee
When you apply for a mortgage you may be asked to pay a valuation fee to cover the cost of valuing your property. The valuation fee is payable prior to valuation and is non-refundable if the valuation is carried out. The valuation is very basic and is carried out for the provider's benefit. . We strongly recommend that you have a more thorough survey undertaken, such as a homebuyers report. This will tell you about the quality and condition of the house you want to buy. There is an additional fee for this service. Get Details of valuation fees
from Nationwide.Variable rate
The interest rate is variable so your payments may go up or down each month.