Welcome back to the second instalment of our jargon buster for home buyers. This series is all about helping home buyers understand all of the jargon that comes up around buying or selling a property. From what the deeds are and why they matter, through to what the word vendor means (since you’ll see it pop up a lot). If you didn’t read our first one, just click here to see what the first instalment covered. Once you’re all caught up, let’s get cracking on part 2!
Deeds: The collection of legal documents showing who has owned the property in the past, and who owns it now.
Energy Performance Certificate (EPC): You might be more familiar with this one, as it pops up in rental accommodation a lot. An EPC rating shows the property’s typical energy use and efficiency across the board. The EPC may also give some recommendations on how to reduce energy consumption and improve efficiency. If you’re buying a property in England, then you are legally entitled to an EPC that’s been done by an accredited assessor for any property you are looking to buy.
Equity: The term for the amount of your property you actually own, and its total value. You can work this out by looking at the value of your home, and then subtracting the amount of your mortgage you still owe. The remaining number is your equity. If in doubt, ask your mortgage broker.
Exchange of Contracts: This is one of the last things to happen when buying a property and is the point when both parties become legally committed to the existing deal. The physical exchange is done by your solicitor or conveyancer, and the vendor’s solicitors.
Gazumping: This one might sound like a made-up word, but it’s not! This is the term for when a vendor has accepted an offer from a buyer, but then accepts a higher offer from another buyer, cancelling their acceptance of the first buyers bid.
Land Registry: The name of the government office that registers all property in England and Wales. Scotland has their own version – the Land Registers of Scotland. You need to let the land registry know when you sell or buy a property so that the details can be updated on the central registry, although this is usually done by your solicitor
Mortgage Fees: This is the collective name for all the different charges associated with putting together and organising your mortgage, and is charged directly by your mortgage provider. It covers arrangement fees, valuation fees, broker fees, higher lending charges and exit fees.
Stamp Duty: Stamp duty is a specialist tax that’s only applied to property. Currently, if the property you’re buying is worth over £125,000, then you will need to pay a percentage of it as stamp duty. Stamp duty is due within 14 days of completion on a property, and can be higher if you are buying a second or third property.
Searches: This is part of the legal process of buying a house that happens pretty early on. Your conveyancer or solicitor will search local records to look for factors that might affect the value of the property. This gives you a good negotiating position if you need to adjust your offer.
Vendor: The person, organisation or body selling the property.
That’s all we’ve got room for today, but don’t worry, we’ll be back! We’re going to keep running through the entire A-Z of home-buying terms until you’re as knowledgeable as an estate agent and can go through the process effortlessly. In the meantime, if you would like to know more about any of the terms we’ve talked about today, or if you want some advice on buying your first home, we’d love to help. Just get in touch with us today and book your free consultation visit.