Advance: The amount you borrow from the lender.
Annual percentage rate (APR): Expressed as a percentage, the total charge for the loan including fees and interest.
Bank of England base rate: This is the interest rate set by the Bank of England, which banks use when calculating the interest rate they set for some products.
Boundry stone: A Substantial stone placed to mark the limit of a Jersey property’s boundaries the location of which is described in the contract.
Buildings insurance: Insures the structure of your home against fire, theft and flood. It is normal an essential part of your mortgage agreement to make sure that you have buildings insurance.
Completion: When you get your keys! The final passing of a contract of purchase before the Royal Court which records legal transfer of ownership of the property – when the property becomes yours. This is also the start of the mortgage, also known as ‘drawdown’.
Contract: The contract passed before the Royal Court recording the agreement by the Vendor to convey the Jersey property to the Purchaser.
Deposit: A percentage of the price of the property which you pay from your own money rather than from the mortgage.
Early repayment charge (ERC): A charge payable on certain types of loan if it is repaid or partly repaid within a certain period, eg during a fixed-rate period or while a discount rate applies.
Endowment mortgage: Sometimes used to describe an interest-only mortgage supported by an endowment policy. Such mortgages are rare these days.
Equity: The difference between the value of the property and the amount of any loan secured against it.
Flying freehold: A method to purchase a flat in Jersey by purchasing a divided share in the freehold of a property.
Freehold: A phrase commonly used to describe outright ownership in perpetuity of the property and the land on which it stands.
Interest only mortgage: Paying just the monthly interest. The original capital balance will still be owed at the end of the mortgage term.
Leasehold: The right to possession, but not ownership, of a property for an agreed period of time. Ownership will always remain with the freeholder.
Loan to value (LTV): The size of a mortgage as a percentage of the value of the property or its purchase price.
Mortgage term: The terms over which you agree to repay the loan.
Offer letter: Also known as a Facility Letter, is the letter that the bank will send you setting out the terms of your mortgage, which you have to sign and return to confirm your acceptance of those terms before the mortgage documents are issued.
Power of attorney: A document you sign to authorise your lawyer or another person to sign documents or pass a contract to buy or sell a Jersey property before the Royal Court on your behalf.
Principal: The amount of the loan on which interest is calculated.
Relief or ‘offset’: A right of access on to a strip of land in Jersey 16 ½ inches wide on the neighbour’s property to maintain your property. Your neighbour cannot build or place anything on a relief.
Remortgage: Repaying a mortgage by taking out another mortgage secured on the same property.
Repayment mortgage: Paying both the interest and part of the capital monthly, so the mortgage is completely paid off by the end of the mortgage term.
Security interest: A charge equivalent to a mortgage taken over shares when buying a flat in Jersey by share transfer.
Share transfer: A method to buy a flat in Jersey, by way of purchasing a block of numbered shares in the company which owns the freehold of a block of flats and the land on which the block stands.
Valuation: This is when the property is inspected to see whether it is acceptable to the lender as security against a mortgage loan . Usually paid for by the borrower.
Vendor: The seller of the home you are buying.