A

Acceptance Fee

Some lenders charge this fee when they give you a mortgage – it usually is about 0.5% of the value of the loan. Most lenders have now waived this fee.

Advance

This is the total amount of the loan you receive.

Annuity

A series of regular payments that you receive for the rest of your life, in exchange for a lump sum /pension fund that you have built up over your working life.

Annuity Mortgage

A mortgage over a set period of time that is fully paid off at the end of the term.

APR

The Annual Percentage Rate.

Appreciation

Any increase in the value of your property.

Arrangement Fee

A charge made by some lenders for organising your loan

Arrears

The payment(s) due when a mortgage payment is not made by the due date. Please keep in mind that your house could be repossessed, if you fail to keep up your repayments.

Auction

Property sale. If you win the bid you are legally bound to buy the home so it is vital to have a mortgage approved and to make sure that the house is structurally sound before the auction.

B

Base Rate

Interest rate set by the European Central Bank (ECB), used to determine borrowing and savings rates across the euro zone countries.

Bridging Loan

A temporary loan to allow you to buy your new house before selling your own home.

Broker

An independent intermediary who will give you advice and offer a range of mortgages.

Building Insurance

Insurance to cover any structural damage to your home. All lenders will need their interest in your home to be noted on the policy.

Buy to Let

You buy a property to rent it out rather than live in.

C

Capital

The sum borrowed to buy the home.

Collateral

Your home, property or some other asset used as security for a loan.

Completion

The point when contracts have been exchanged and ownership legally passes to the buyer.

Contents Insurance

Insurance to cover any loss or damage to your possessions.

Contract

The legal agreement prepared by a Solicitor to bind the seller and buyer to the sale of the property.

Conveyancing

The legal work involved in buying or selling a house.

Credit Search

A check the lender makes with a specialist company, such as the Irish Credit Bureau, to find out whether you have a record of not paying loans, credit-card bills etc.

D

Deed

The legal document by which legal title to freehold and leasehold property is transferred from the seller to the buyer.

Deposit

The amount that a buyer must pay on exchange of contracts (usually 10% of the agreed property price).

Drawdown

After the exchange of contracts, the bank ‘draws down’ the loan funds and sends them to your solicitor who receives the funds on your behalf in order to purchase the property.

E

Estate Agent

This person represents the seller in return for a fee, usually represented by a percentage of the price achieved for the property

Endowment Mortgage

Interest is paid to the lender each month. A payment is also paid into a savings/investment policy each month. The loan is repaid at the end of the loan period from the proceeds of this policy.

Equity Release

This is the difference between what your home is worth and the amount you owe on your mortgage.

Exchange of Contracts

The point at which the buyer and seller are legally bound to the sale and purchase of the property.

Excess

The amount of money which you have to pay yourself if you make a claim on your insurance policy.

F

Failed Valuation

When the lender turns down your mortgage application after reading the surveyor’s valuation report.

Fixed Rates

This fixes your repayments at your chosen rate for the period of your chosen term regardless what happens on the variable rate market.

Freehold

The owner of the property owns the property without payment of any rent and without a limit in time.

G

Gazumping

When the seller having already accepted an offer from Party A accepts a higher bid from Party B.

Grace Period

A period after a premium payment is due on an insurance policy (but where a policyholder is late making the payment), during which the policyholder can make the late payment without losing the protection which the insurance policy provides.

Ground Rent

A sum of money, usually paid annually, by leaseholders to the owner of a freehold.

Guarantor

A person who agrees to guarantee a loan. They are responsible for the mortgage payments if you can’t afford to pay them.

H

Home Bond

Guarantee on most new houses and apartments. It provides against: losing your deposit if the builder goes bankrupt, 10 years Warranty against major structural faults, and 2 years Defect Warranty against water and smoke damage after completion.

HB47

The HomeBond Scheme Certificate (provided by your builder). The aim of this scheme is to protect new homes against structural defects and to ensure that property standards are maintained in the house building industry.

Home Insurance

Protection against risks like fire, theft and malicious damage is key to peace of mind. When looking to insure your home and possessions, some items are categorised as ''buildings'' such as fitted furniture and anything that is plumbed in. Other items are treated as contents. The easiest way to make sure everything is covered is to insure both building and contents under one policy.

I

Indemnity Bond

An upfront one-off fee charged by some lenders if you borrow in excess of 70-80% of the house value to protect them against you defaulting on the loan. For first time buyers, most lenders will not absorb the cost of the bond, and pay it themselves.

Interest

Money paid for the use of money.

Interest Rate

How much you pay for borrowing a particular sum of money for a specific time, expressed as a percentage rate.

Interest Only Mortgage

You pay only the interest on your mortgage and pay off the money borrowed at the end of its term.

Intermediary

A person or organisation that offers advice and arranges policies for clients.

L

Land Registry

The Land Registry deals with the registration of ownership. The register is conclusive evidence of the title of the person whose name appears on it. Most agricultural land in Ireland is registered in the Land Registry.

Leasehold Property

A leasehold title is a right of possession, but not ownership, of a property under the terms of a Lease, for an agreed period of time, with the payment of rent.

Legal Charge

A legal document, which creates a security interest over the borrowers'' property in favour of the lender.

Life Assurance

An insurance policy which pays out a fixed lump sum on the death of a policy holder. All lenders will require you to have life insurance to cover the mortgage. This is often referred to as Mortgage Protection.

Loan to Value

This expresses your mortgage as a percentage of the value of your property. For example, if you have a property worth €100,000, and you are borrowing €92,000, your Loan to Value is 92%.

M

Mortgage

A long term loan to finance the purchase of a property.

Mortgagor

The lender of the mortgage

Mortgagee

The borrower.

Mortgage Interest Relief

This is tax relief that you can claim on mortgage interest payments. People buying for the first time are entitled to the highest amount of relief. From 1 January 2002, qualifying tax relief for mortgage interest has been applied at source by your mortgage lender.

Mortgage Term

The period over which the mortgage is to be repaid.

N

Negative Equity

When the value of the property has fallen below the outstanding mortgage debt.

O

Offset Mortgages

Offset or all in one mortgage’s allow you to offset the balance of your mortgage, and any other borrowings you have, against any money you have in a savings and/or current account that’s held with the same lender. All your borrowings and savings may be combined in one account.

P

PAYE

Pay-As-You-Earn - where your employer takes income tax off your salary or wages before you get it, and pays it direct to the Revenue Commissioners on your behalf.

Payment Holiday

A feature offered by some mortgages that allow you to miss monthly payments on your mortgage.

Pension

Money you get after you retire, usually either from the government or your previous employer/s.

Personal Loan

A loan which you take out as an individual, with a fixed interest rate and a fixed number of repayments.

Policy

The full details and terms of an insurance contract.

Premium

The monthly amount payable for an insurance policy.

Q

Quotation

A calculation provided by your bank to give you an idea of how much you can afford to borrow and what your monthly repayments would be.

R

Rate

The cost of a given unit of insurance.

Redemption

When you pay off a mortgage in full, including interest to date and all charges.

Registry of Deeds

The Registry of Deeds provides for the registration of documents dealing with unregistered land. Registration in the Registry of Deeds does not guarantee title to the land.

Re-mortgage

This is the process of switching your mortgage from one lender to another, often for a more competitive rate.

Repayment Mortgage

A mortgage where the capital and interest are paid off in monthly installments.

Retention

A condition of a mortgage where the lender holds back a portion of the loan, pending work to be carried out by the mortgagor.

S

Searches

A solicitor carries out searches on the property to establish if the seller has a legal right to sell the property and to determine whether there is anything that might affect the title of the property.

Snag List

When a new home is built the buyer is recommended to arrange for a surveyor to check if there are any defects which need to be fixed before they complete the sale.

Sole Agent

When a seller sells their home exclusively through one Estate Agent.

Solicitor

Legal representative who acts on behalf of a buyer or a seller in the purchase or sale of a house.

Stamp Duty

An amount of money you have to pay to the government when you buy a property.

Structural Survey

A comprehensive and detailed assessment of the condition of the property carried out by a qualified surveyor. It can identify defects that would not be evident from a valuation of the property.

Surveyor

The person who carries out the structural survey of the property.

T

Term

The period for which a mortgage is taken out.

Title

The legal ownership of a property. It is also the type of ownership, e.g. freehold title or leasehold title.

Title Deeds

The documents showing the ownership of the property.

Tracker Mortgage

Matches movements in the European Central Bank base rate so that you benefit quickly from a fall in interest rates.

U

Undertaking

The process of analysing a mortgage application to determine the amount of risk involved; it includes a review of the potential borrower''s credit history and a judgment of the property value. It also sets suitable loan terms and conditions.

Underwriter

A technician trained in evaluating risks and determining rates and coverage for them.

V

Valuation

A survey carried out by the lender to ensure that the house is not worth less than the proposed loan. This is separate to a structural survey which is recommended for a second hand property.

Variable Rate

Your monthly repayments may fall or rise from time to time in line with general market interest rates.