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A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

A

APRC

The Annual Percentage Rate of Charge (APRC) is designed to help you compare the cost of different mortgage deals. It takes into account the amount of interest you'll pay, the term of the mortgage and other charges like application fees and valuation fees.

Arrangement Fee

Arrangement fees are charged on certain products, usually loans where a special interest rate applies. Details of any arrangement fees can be found in the product literature or Key Facts Illustration Document.

B

Base Rate

The main interest rate in the economy, set by the Bank Of England, upon which other rates are generally based.

C

Capital Repayment

When a customer makes a one-off payment to reduce the outstanding balance on their mortgage subject to our terms and conditions.

COT (Certificate of Title) 

A Certificate of Title (COT) is provided by your solicitor when you buy a property and is required on all new mortgages. It confirms that your solicitor has carried out all the necessary checks on the title (ownership) of the property and that any special conditions of your mortgage offer have been met. It confirms any leaseholds, insurance arrangements, the purchase price and title number.

CHAPS

CHAPS stands for Clearing House Automated Payment System. A telegraphic transfer through which the mortgage advance is sent to the conveyancer. 

D

Discounted Rate

Where a discount is applied to the lender's Standard Variable Rate (SVR), usually for a limited period.

E

Equity

The positive difference between the value of your property and the amount of any outstanding loans secured against it (ie the amount you own outright). If your outstanding mortgage is £60,000 and your home is worth £100,000, you have equity of £40,000.

ERC

Some of our mortgage products have specific terms & conditions. One of these may be an Early Repayment Charge (ERC). An ERC may become payable when you pay off all or part of your mortgage. Details of any Early Repayment Charges will be given in the product literature, the Key Facts Illustration and your mortgage offer.

F

Freehold

If you have a freehold property, you own it outright, unlike leasehold.

G

Guarantor

A person who promises to pay the debt of another person, if that person fails to pay.

H

HPI

The House Price Index (HPI) is a calculator that helps you work out the current value of your home and provides general information about the house price market.

I

Interest Only

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.

J

Joint Tenants

A form of ownership frequently used by couples which ensures that when one dies, the property passes automatically to the other. The alternative is Tenancy in Common.

K

KFI

A Ket Facts Illustration (KFI) requires all lenders to set out the details of all associated rates and fees for a mortgage product in the same format to enable customers to easily compare products.

L

Leasehold

Ownership of a property, by a landlord or freeholder, for a fixed term, usually between 99 and 999 years. The buyer buys the lease and pays ground rent and service charges to the landlord or freeholder.

LTV

Loan to Value (LTV) is the amount of the mortgage balance shown as a percentage against the value of the property. For example, a £75,000 mortgage on a house worth £100,000 would have a 75% LTV.

M

Mortgage Deed

A legal document signed and sealed and delivered to effect a transfer of property and to show the legal right to possess it.

R

Redemption

The process by that your mortgage is brought to an end when you have paid back all of the loan, interest, costs and other charges which are due on it. The lender then has no further claim on your property.

Remortgage

Replacing a mortgage with a different product; for example, to obtain a better interest rate or release further funds.

Repayment Vehicle

An investment designed to grow sufficiently to pay off an interest only loan when the mortgage period expires.

S

SVR

Standard Variable Rate (SVR) is set at the sole discretion of the Society and is set independently from the Bank of England Base Rate. The setting of these rates reflects the costs of funds that we raise from our savings customer base and rates of interest in the wholesale money markets. Most of our products revert to SVR after a tie in period.

T

Title Deeds

Every property has a document or set of documents known as Title Deeds. They show the ownership of the property. Ownership is now also recorded electronically at the Land Registry.

U

Unencumbered Property

A property that has no loans or borrowings secured on it.

V

Variable Rate Interest

This is an interest rate you pay on your mortgage which rises and falls according to a specific index, such as our Standard Variable Rate (SVR).