Mortgage Glossary
Higher lending charge (HLC)
Higher lending charges (HLCs) are charges made by lenders when a buyer’s loan to value (LTV) exceeds a limit specified by the lender.
HLCs help to cover the increased risk taken on by the lender and may be used to buy a Mortgage Indemnity Guarantee, which protects the lender should a buyer default on their mortgage payments.
Interest only mortgage
Interest-only mortgages see the borrower make no capital repayments until the end of the mortgage term.
Borrowers, instead, pay back the mortgage interest over the term of the loan.
Interest-only mortgages can be risky if the value of the property isn’t enough to pay back the capital at the end of the term.
Please note that Martin & Co does not provide investment advice, and should you require such advice, we recommend that you contact an Independent Financial Adviser. Martin & Co is not responsible for any advice you receive from a third party.
Land Registry
The Land Registry is the official body responsible for registering and holding details of property ownership in the UK.
Land Registry searches take place are part of the legal process when buying a property.
Leasehold
Most flats and apartments are leasehold properties, meaning the buyer owns the property for the period remaining on the lease.
At the end of the lease, the property would fall under the ownership of the freeholder.
Lifetime mortgages
Lifetime mortgages are equity release mortgages.
If you require a lifetime mortgage, you should seek independent financial advice.
Martin & Co is not responsible for any advice you receive from a third party.
Loan to value (LTV)
Loan to value (LTV) is your mortgage figure expressed as a percentage of your property’s total value.
So, a property worth £200,000 with a £130,000 mortgage would have an LTV of 65%.
Local Authority search
Local Authority Searches are carried out by solicitors and conveyancers when you buy a property.
These searches help to establish whether there are any local authority notices or plans that could impact the property and land that surrounds it.
Monthly repayment
This is the payment you make to your lender to repay the loan every month.
Mortgage
A mortgage is a loan secured against a property.
Mortgage deed
Mortgage deeds are legal documents that formally secure the mortgage loan against your property.
Mortgage Intermediary
A mortgage broker is a type of intermediary who sells mortgages on behalf of lenders.
Mortgage term
Your mortgage term is the amount of time you have to repay the loan.
Typically, mortgage terms are 25 years, but can be shorter or longer depending on the borrower’s personal circumstances and subject to a lender’s criteria and affordability checks.
