A step-by-step guide to buying your first home

Transcription

1 Heping you take your first steps on the property adder. Ca our Newcaste based ca centre on: Monday to Friday 8am to 8pm and Saturday 9am to 3pm (excuding bank hoidays) Cas may be monitored and recorded for training and security purposes. Or visit us onine: First time buyers guide A step-by-step guide to buying your first home Newcaste Buiding Society Principa Office: Portand House, New Bridge Street, Newcaste upon Tyne, NE1 8AL. Newcaste Buiding Society is authorised by the Prudentia Reguation Authority and reguated by the Financia Conduct Authority and the Prudentia Reguation Authority. Newcaste Buiding Society is entered in the Financia Services Register under number You can check this on the Financia Services Register or by contacting the Financia Conduct Authority on Ca or visit us onine YOUR MORTGAGE WILL BE SECURED ON YOUR HOME. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE. Detais are correct as at time of print (March 2017) ADV003 Loca knowedge. Mutua understanding. newcaste.co.uk

2 Heping you take your first steps on the property adder At Newcaste Buiding Society, we understand it can often be daunting when considering buying your first home. There s so much to think about before you even consider ooking for a property, so we ve deveoped this hepfu guide with you in mind. It provides a step-by-step guide to assist you through each stage of buying your first home, from working out your budget before you start house hunting, right through to hepfu hints and tips for your moving day. Contents Choosing the right mortgage 3 What type of mortgage is best for you 4 How much do you have for a deposit? 5 Start saving 6 Choose the right mortgage There are a ot of mortgage deas in the market, offering different features, meaning it can be difficut to choose the right one. But, answering the foowing questions shoud make things easier for you. Firsty, how do you want to pay your mortgage back? Repayment A repayment mortgage means on a monthy basis you are paying back an eement of the money you ve borrowed, as we as the interest payabe on your oan. The benefit of this type of mortgage is that at the end of the fu mortgage term, you wi know you ve repaid the entire amount you borrowed, as we as any interest, so you wi own your home outright. Interest ony By seecting an interest ony mortgage, you wi ony pay the interest on a monthy basis and so wi not reduce the amount you borrowed; meaning the size of your mortgage wi remain untouched. This means you are responsibe for making suitabe arrangements for the oan (caed a repayment vehice) to ensure it is repaid at the end of the mortgage term and providing evidence of this. It shoud be noted, Newcaste Buiding Society does not currenty offer interest ony mortgages. The Decision in Principe 7 Looking for a property 8 Found your first home? What s next 9 Getting a survey/vauation 10 Choosing a Soicitor 11 Making an offer 12 Competion - it s finay yours 13 The countdown to move day Jargon buster

3 What type of mortgage is best for you? There are three main types of mortgage deas that you can choose from: How much do you have for a deposit? The amount you can afford as a deposit wi have a direct impact on how much you can and need to borrow. The more deposit you re abe to put down, the ess you wi need to borrow. Fixed rate A fixed rate mortgage aows you to fix your interest rate aowing you to pay a set amount each month, for a set period of time, for instance two, three or five years, athough there are some 10 year mortgage deas. The advantage is you know exacty how much you wi have to pay each month so you can budget more easiy. Variabe rate A variabe rate mortgage is inked to your ender s underying mortgage rate, known as their standard variabe rate (SVR). This can vary (and not necessariy in ine with the Bank of Engand base rate), which means your payment can go up or down. Base rate tracker A base rate tracker mortgage changes usuay depending upon what the Bank of Engand s base rate is, meaning it can go up or down each month. If the rate rises then your repayment may increase, however, if the rate decreases you may benefit from a reduction in your monthy payment. At the Newcaste, we usuay have First Time Buyer mortgages that ony require a deposit of 5% of the purchase price. This means if you re hoping to buy a property of around 150,000, you wi require at east 7,500 as a deposit. What other costs can I expect? Don t forget there wi be other costs invoved in buying a home, so you shoud factor a of these into your budget to ensure you ve covered everything off. Some exampes of the other costs are as foows: Vauation fee Mortgage arrangement fees Soicitor s fees Land Registry fee Loca Authority searches Stamp duty (ony for properties over 125,000) Buidings, contents, ife and protection insurance Decorating and furnishing costs Moving costs. We may be abe to hep with some of these costs with our unique A in One range, which covers the vast majority of fees. This ist isn t exhaustive and doesn t cover everything so it s important you do your research. 4 5

4 Start saving... Saving for a deposit can seem daunting, but it may be easier than you think. Cutting back on just some of those itte uxuries can go a ong way to heping. The tabe beow shows our most common uxury s and how much you coud save by giving them up for a whie, a heping you get that deposit saved: What you give up How much wi you save each time? Monthy Yeary Daiy coffee (5 days per week) 2.70 a day (based on a reguar cappuccino)* Cigarettes (10 per day) 4.00 a day (based on a pack of 20 at 8.00)* 122 1,460 Beer (5 pints per week) 3.20 per pint* Wine (2 bottes per week) 6.99 per botte* Eating Out (weeky) (based on average three course mea for two at 45.00)* 97 1,170 Chocoate (1 bar per day) 0.51p (based on RRP of standard Mars Bar)** Cinema trips (weeky) 8.32 per ticket* TOTAL 459 5,509 How much wi we end you? Before starting your search for a home, you need to find out how much you can borrow. Sometimes, estate agents won t et prospective buyers view properties unti they know a ender is ikey to provide a mortgage. But don t worry, we can hep you with what s caed a Decision in Principe known as a DIP. *Source: Numbeo, **Source: Daiy Mai, Hep to Buy: ISA & Newcaste First Home Saver If you choose to save for your deposit with our accounts, you coud be eigibe for a cash bonus of up to 1,000 shoud you decide to compete a mortgage with the Newcaste. This coud then hep you towards the cost of buying your new home. First off, speak to your mortgage adviser to get a Decision in Principe (DIP). The DIP wi provide you with usefu information, such as how much we woud be wiing to end you, and what type of mortgage dea wi be best for you, but it wi aso provide you with the required document some estate agents request before they aow you to view potentia homes. The quotation provided wi be based on the foowing information you have provided us with; Your income(s) Your monthy outgoings Your empoyment status The type of property you re ooking to buy This quotation doesn t cost you anything and doesn t incude any credit checks at this stage. It is worth noting, however, that a DIP isn t a guarantee that a ender wi provide you with a mortgage and any ending wi be subject to a fu mortgage appication. 6 7

5 Looking for a property Viewing a property that coud potentiay become your new home is no doubt exciting. But, for some, there s the worry they coud make the wrong decision to buy, simpy because they didn t find out as much about the property as possibe when making their first visit. So for a better chance of finding a house you can happiy ca your home, take a ook at these top ten tips: 1. Research the area, your estate agent shoud be abe to provide some information but it s aso worth finding out about the oca trave services, doctors, entertainment venues to see if they are suitabe for you and your famiy. been repaced at any time and ask to see copies of guarantees and warranties. Aso, don t forget to check the Energy Performance Certificate from the seer which wi give you a good indication of what energy bis you may face. Found your first home? What s next? Once you have found the right property for you then you need to make an offer and agree the purchase price with the seer, which is normay done via the estate agent. As you re a first time buyer, you re in the great position of not being in a chain and so may be better abe to negotiate on the price. Again, this is a done through the estate agent. 2. Visit the area at different times of the day, to get a genera fee for the town or street you are interested in. Keep in mind the traffic and noise voumes. 3. Check out the property externay first, ook out for oose roof ties, cracks in exterior was and poor quaity window frames as these coud indicate further work and money. 4. Check for damp patches on was or ceiings, some may be hidden behind furniture or arge pictures. Rusty radiators or pipes are aso good indicators of damp properties. 5. Consider areas that woud be most costy to repair, once inside the property. If the property is od, ask if the eectrics, damp proof course or heating systems have 6. Kitchens and bathrooms are the most expensive rooms to refit so if you don t ike the current fixtures and fittings, remember to budget for repacements. 7. Ignore basic décor, everyone s tastes are different and basic decorations are not expensive to re-do. 8. What direction does the property face? It may sound siy but if you ike to sit in the sun in your garden, you have to consider this. 9. Is the driveway big enough? Does it have a garage and does the street offer suitabe and safe parking spaces for you and visitors? 10. Be prepared to be fexibe, remember there s no such thing as a perfect house. Making a fu mortgage appication Now is the time to make your fu appication. Your mortgage adviser wi arrange this with you. Once we ve received your mortgage appication and any associated fees, at this stage credit checks wi be run to ensure you can afford the oan, and you be asked for documents to support your appication. Your mortgage adviser wi highight what documents are necessary for your appication, which normay aow us to check the foowing: Your identity Your income Your current address. It s a good idea to bring these aong to your appointment. 8 9

6 Getting a survey/vauation Choose a Soicitor As part of your appication, a survey needs to be carried out on the property you want to purchase. This is done to make sure the vaue of the property is enough to cover the mortgage and there are no major probems with the property. The soicitor s main job is conveyancing - this means egay transferring home ownership from the seer to the buyer. Your soicitor wi iaise with the seer s soicitor to check the ega tite to the property you wish to buy is acceptabe and can be egay transferred to you. We arrange the survey and you can generay choose from the foowing three options: They wi aso carry out oca searches with oca authorities, drawing up your contract, preparing transfer documents, checking ega documents, performing and registry searches and much more. Vauation for mortgage purposes This is the basic assessment carried out and enabes us to decide whether or not to end you the money for the property by assessing its condition. This basic vauation is for the ender s benefit ony. Homebuyers report This is a survey on a property carried out on your behaf. You wi receive a report on the condition of the property, which wi state any repairs or defects that need attention. Structura survey This is a comprehensive survey, aso known as a fu survey, which is carried out to thoroughy examine the condition of a property. This type of survey is usuay recommended if you re buying an oder or more unusua property. The report wi detai any defects and potentia defects, and te you what needs to be done to remedy them. The survey cost depends on the type you choose and the purchase price/vauation of the property. We wi be abe to advise you on this cost, this may even be incuded as part of the mortgage we offer you. In some cases, the mortgage vauation may not necessariy refect the price of the property. This may restrict the mortgage products avaiabe to you as your Loan to Vaue (LTV) may have changed. In these cases, we may have to switch you to another, more appropriate mortgage product. It coud aso mean that we are unabe to offer you a mortgage. If we are unabe to offer you a mortgage after your mortgage vauation, any product appication or vauation fees woud not be refunded, so it is essentia that you are as accurate as possibe when providing us with an estimated vaue of your property. There are a number of websites that can provide estimates of current property vauations and house prices and we woud encourage you to ook at these prior to making your appication. The seer s soicitor wi prepare the contract for sae and send this to your soicitor aong with the required tite documents. Your soicitor wi then check and approve the contract and tite to the property on your behaf. The contract is the ega agreement between you and the seer, which sets out the price, terms and date on which the property wi transfer into your ownership. So how can you make sure you find the right soicitor? Firsty, it coud be hepfu to use a oca soicitor as they may have a reationship with the oca panners and may understand oca reguations. Caing around and speaking with companies wi give you an idea of how efficient and hepfu they be. A good conveyancer wi take the time to expain what it is they wi do ceary and concisey, and shoud strive to gain a fu understanding of your needs. Tak to friends and famiy who have recenty moved house and find out who they used. Word of mouth reay is a powerfu too and can either put you in the right direction or at east make sure you steer away from a bad one. Searching the web coud provide you with a ot of free information to see what companies there are avaiabe in your oca area. Aso, how comprehensive and hepfu their website is can be usefu, so it s we worth a browse. As with anything, costs can be a factor when choosing a conveyancer and may be the biggest decider for you. Newcaste Buiding Society does have a partnership with the UK s eading conveyancing pane management speciaist, Lega Marketing Services (LMS). LMS provides a managed conveyancing service to NBS to carry out ega work required for remortgaging or purchasing your home. For further detais, pease contact us on:

7 Making you an offer Competion - it s finay yours! Once we ve received your appication, aong with a of your supporting information and the vauation has been carried out, we check everything to ensure a of the detais are satisfactory. At this stage we provide you with a mortgage offer. When you exchange, you shoud aso agree a competion date. Competion is the ast ega hurde you face, this is when the money is transferred from your mortgage provider to the seer and is a organised through your soicitor. This offer wi state how much we wi end you, over what term and the rate of interest to be charged. A copy of the mortgage offer wi aso be sent to your soicitor who wi be abe to assist you by fuy expaining a of the terms and conditions to ensure you fuy understand and accept them. Once you have accepted the terms of the offer, your soicitor wi take the mortgage offer and start the procedure of exchanging contracts with the seer. Exchanging contracts By this time, you shoud be happy with everything, and so your soicitor wi compete a of the ega paperwork, incuding drafting your contract ready for you to sign. As part of the contract, there shoud be a ist of fixtures and fittings incuded in the price such as kitchen appiances, carpets and curtains. This contract is egay binding, so at this point you re making a rea commitment and if you subsequenty pu out, you coud ose your deposit. So, if you have any ast minute doubts or concerns, you must make sure you raise them with your soicitor first. Once you ve signed the contract, your soicitor wi hand it over to the seer in exchange for the contract they ve signed. From now on, you are both committed to the dea and neither of you can pu out without attracting some significant costs. Now that you ve exchanged contracts, you become egay responsibe for insuring the property. Meaning you wi need to get some buidings insurance in pace for this don t wait unti the competion date. Your mortgage adviser shoud have aready discussed getting this insurance in pace. Once the payment has been confirmed, you wi be given the keys to your new home by the estate agent. We wi aso write to you on competion to confirm what date your first mortgage payment wi be coected

8 Countdown to move day Now a of the ega bits are out of the way, you can move into your new home. To hep ensure you don t forget anything, we ve deveoped some checkists; these shoud hep keep the day as stress free as possibe. Before you move checkist If you ive in rented accommodation, as soon as you ve found somewhere, you shoud contact your andord as you may need to give them notice that you re eaving 1 month before moving Notes: Start having a cear out of anything you don t want to take with you to your new home. Ask friends and famiy to hep you with the move the more peope you have the easier it wi be. Get a few quotes for remova companies, or van hires, and book one. Weekends are aways in high demand so try to opt for a mid-week move. Get penty of boxes and ots of packing materias. Make sure you book some time off from work for the move. Make sure your home insurance covers your goods in transit for the move. 1-2 weeks before moving Notes: Start packing everything you won t need on the ead-up to the move. Make sure you don t pack boxes too heavy to ensure you don t hurt yoursef during the move. And don t forget to abe a of the boxes. Arrange for your mai to be re-directed to your new address. Make sure you have someone to ook after your young chidren and pets during the move as having them around can sometimes make the move more difficut. Inform your providers, such as DVLA, car insurance, banks, buiding societies, teephone, TV icence, gas/eectricity, water, counci tax, empoyer, etc. that you re moving. If you re moving out of the area you shoud deregister from your doctors and dentists and register with someone in your new area. Notify oca services, such as mik and paper deiveries, window ceaning, etc. to arrange a canceation date

9 The day before moving Pack everything you don t need for the move, making sure you keep a your vauabes in a safe pace. Make sure that you defrost both your fridge and freezer. Keep a essentia items handy, such as cash, credit cards, mobie phones, keys and officia documents. Put aside a few things in a box to make the moving day as stress-free as possibe, such as refreshments, toiet paper, ceaning materias, kette, tea, etc. Keep these out of the way of any removers to ensure they don t get packed away with every thing ese. Perhaps incude a botte of champagne and some gasses to ceebrate ater! You shoud eave your od house as cean as you d ike to find your new house, so once everything has been packed, cean as much as possibe. Moving day hints & tips Aways ask peope to hep with the move, the more peope you have, the ighter work it wi be. You wi aso need assistance carrying those heavier items. Count the boxes before they are moved and check when they are deivered to your new address that you have them a. Make it your priority once you reach your new home to make the beds and hang the bedroom curtains as soon as possibe by the end of the day you be exhausted and it wi be great to just reax. Don t attempt to do a your unpacking on the first day, just unpack the essentias and make sure there is somewhere comfortabe to sit, eat and seep. Take meter readings from both your od and new addresses to give to your energy suppiers. Once everything has been packed into the remova vans, check your od house over to make sure nothing has been eft, everywhere is ocked up and the pace is cean and tidy. Make sure you eave the keys in the arranged pace. Notes: Notes: 16 17

10 Jargon-buster Accidenta Damage - Optiona insurance cover for your buidings and/or contents which provides protection for accidents that might damage the permanent structure of your home or your beongings. Additiona Borrowing (aso known as Further Advance) - When an existing mortgage customer wishes to increase their mortgage borrowing and which is often used for home improvements but can (subject to ending poicy) be used for any purpose. APR (Annua Percentage Rate) - A guide to hep you compare the cost of different mortgage deas, taking account of interest rates payabe (both during the initia product period and after) and incusive of any fees. Arrears - Mortgage payments which have not yet been paid as requested and have become overdue. Bank Base Rate (BBR) - This is the rate which is set on a monthy basis by the Monetary Poicy Committee (MPC) of the Bank of Engand and is the rate that it charges for its borrowing. Base Rate Tracker - The interest rate is inked to, but may not be equivaent to, the Bank of Engand base rate. When there is a change to the Bank of Engand base rate your mortgage payment rate wi refect this (within 14 days). Buiding Society - A mutua organisation which is owned by its members. Buiding Insurance - An insurance poicy which is taken to protect your property against hazards such as fire, food and subsidence. A buidings insurance is required as part of the mortgage terms and it is the borrowers responsibiity to ensure the property is adequatey insured for the duration of the mortgage. Buy-to-et mortgage - A mortgage that is used for borrowers who wish to purchase a property to rent out. Capita - The amount of money you sti owe on your mortgage. Capita and Interest Mortgage - This is the most common way to repay your mortgage. Your reguar repayment is made up of some of the amount borrowed pus interest every month. It means your mortgage wi be repaid in fu by the end of the term providing a payments are maintained in fu and on time. Capita Repayment - A ump sum payment made to your mortgage account and in addition to your norma monthy mortgage payment. Cashback Mortgage - A mortgage product which offers you a cash ump sum upon competion - this may be a fixed ump sum or a percentage of your mortgage amount. Coatera/Security - This is usuay the property and which the ender can se to repay the oan if the borrower does not maintain mortgage payments and fas heaviy into arrears. Competion - After you exchange contracts on a property, you wi agree a date for competion with a the parties invoved. This is the date at which property ownership is egay passed to the buyer, and when the seer must move out and the buyer may move in. Competion Fee - This is a non-refundabe fee which covers the processing of your mortgage appication and setting up of your account. Consent to Let - Permission from your mortgage provider wi be required if you wish to et/rent out your property if your current mortgage is arranged on a residentia basis. Contents Insurance - This is an insurance poicy which is used to cover your persona possessions in your househod, in case they are stoen or damaged. Contract Variations - Where a borrower makes a variation to the terms of their existing mortgage, for instance reducing /extending the term or converting the repayment type. Contracts - The ega documents under which the buyer and seer of the property agree terms. Conveyancing - The process of transferring ownership from one person to another. County Court Judgements (CCJs) - Is an order made in a county court for a debt to be repaid in Engand and Waes. Credit reference agency - Credit reference agencies are organisations that gather information about peope and businesses across the UK. This information comes from enders such as banks, credit card companies and fraud prevention agencies, as we as records in the pubic domain. Credit report - Credit report is a report issued by a credit agency usuay for a sma fee which highights someone's past purchase behaviour and credit rating. Credit search - A credit search is when we carry out a search on your name and address with a credit reference agency to hep us understand more about your credit history. Each time a search is done it is noted on your credit record to et other organisations know that we have asked for information about you. Credit Scoring - A system used by enders to assess the credit worthiness of potentia borrowers. Daiy Interest - This means the interest on your mortgage is cacuated on the outstanding baance each day so every payment you make immediatey reduces the baance on which your interest is cacuated. Debt Consoidation - A oan taken in order to repay existing outstanding debts. You may be abe to spread the oan over a onger period, which may reduce your monthy payment, but by increasing the term you may pay more interest overa. It may be possibe to increase your mortgage to pay off debts (subject to our ending poicy), but it s important to seek advice before doing this. Decision in principe (DIP) - Before you make an appication for your mortgage you can submit a DIP which tes you how much we woud end you based on your income and commitments. Deposit - This is the amount of money that you pay on exchange of contract as part of your initia contribution to the purchase of your home. Direct Debit - A Direct Debit is an agreement between you and a company you want to pay on a reguar basis. The agreement you make authorises the company to coect varying amounts from your account on a reguar basis. Because you re covered by the Direct Debit guarantee, the company shoud aways te you what these amounts are - and when they be coected. Disbursements - The fees your soicitor or icensed conveyancer wi incur during conveyancing e.g. search fees and and registry fees. These are added to your overa ega bi. Discharge Fee / Mortgage Exit Administration Fee - A fee charged for the administration work invoved of the ender to redeem your mortgage. Discount Rate - This type of mortgage usuay offers a discount off the ender s Standard Variabe Rate (SVR). The discount period usuay asts for a reativey short period typicay two or three years, after which, the rate reverts back to the Standard Variabe Rate. Eary Repayment Charges - On some mortgages, a charge wi be made if part or the entire mortgage is paid off before a pre-agreed date, or moved to another product or ender. Your mortgage terms and conditions shoud state if this charge appies. Eectronic Transfer - This is the method by which your mortgage advance is paid to your conveyancer. Endowment Poicy - A ong-term savings poicy (usuay between 10 and 25 years), which is often used to repay the capita eement of an interest-ony mortgage at the end of the term or pay off an outstanding mortgage in the event of death. This type of poicy coud be a repayment vehice for an interest ony mortgage. Equity - The difference between the vaue of your property and the tota amount of mortgage secured against it. Execution Ony - A mortgage transaction competed upon the specific instructions of the customer where the ender does not provide advice reating to the suitabiity of the mortgage transaction. Excess - A fixed amount of money, which the poicyhoder agrees to contribute toward the cost of a caim under an insurance poicy. Exchange of Contracts - The date at which you agree to exchange contracts to commit to buying a property. Once contracts have been exchanged, you are egay obigated to buy the property. After exchange, a date for the competion of the property purchase can be set. Feuda - A form of ega tite appicabe ony in Scotand Financia Conduct Authority (FCA) - The Financia Conduct Authority is responsibe for the reguation of firms' conduct and ensures the appropriate eve of protection for consumers. First Charge - Most mortgage enders wi require a first charge. This means that the ender has first ca on any funds avaiabe from the saes of the property to cear the outstanding mortgage debt. First Time Buyer - An individua who has not previousy owned a property Fixed Rate - This type of mortgage means that the interest is fixed for a specified period of time which means that the monthy repayments wi remain unchanged unti the product period ends. Freehod - Where the borrower owns both the property and the and. Gazumping - A term used to describe the action of a seer accepting an offer and agreeing to the sae of their property, ony to accept a higher offer before exchange of contracts has taken pace. Ground Rent - An annua charge payabe by easehoders to the freehoder. Guarantor - A person who guarantees you wi pay the mortgage repayments. If you don t pay they are iabe to have to pay them themseves. Often parents or reatives are guarantors for first time home buyers to hep them to afford a property. Higher Lending Charge (HLC) - This is a fee sometimes payabe by the borrower to insure the ender against potentia oss if a home has to be repossessed or sod. Homebuyers report - A survey on a property, carried out by professiona surveyors on your behaf. You wi receive a report on the condition of the property, stating any repairs or defects that need attention. A more comprehensive survey is caed a fu structura survey, which you might decide to carry out on oder properties. Home Mover - A person seing one property and purchasing another property. Income Assessment - The Society no onger assesses your borrowing capacity through income mutipes and has deveoped a new Affordabiity Cacuator which is now more taiored to your individua circumstances. Assessment of how much you can borrow is now cacuated through a combination of your income, reguar commitments and househod / ifestye expenditure. Income protection - This can give you a reguar monthy income if you are off work for a proonged period because of an accident or iness. Initia Discosure Document - This document confirms the type of mortgage service we as a ender wi provide. This can be advised, where we offer hep and advice on the type of product best suited for you or Execution Ony, and non-advised, where you decide which product to appy for. Initia Interest - Any payment due for the period from the day the mortgage began up to the first payment date. Insurance - An agreement under which individuas, businesses and other organisations, in exchange for payment of a sum of money (a premium), are guaranteed indemnity for osses resuting from certain events or conditions specified in a contract (poicy). Interest Ony Mortgage - You ony pay interest to your ender throughout the mortgage term and your mortgage baance doesn't reduce. At the same time, you put money into a separate investment which shoud grow and pay off the mortgage as schedued. You wi sti owe capita at the end of the mortgage term. It is imperative that you have a pan in pace in order to be abe to repay your oan. Pease note that currenty the Society does not offer Interest Ony mortgages. Key Facts Iustration - This sets out detais of the mortgage product that a customer is interested in. A mortgage enders are required to set out the detais in a Key Facts Iustration in the same format, so it s easier for you to compare different mortgage deas. Land Registry Fee - A fee charged to register your detais in the Land Registry records once you have bought a property or changed enders. Leasehod - Ownership of a property for a number of years on ease, after which ownership reverts back to the freehoder. Lending Into Retirement - When the mortgage term exceeds beyond the customers retirement age. Lessee - The person to whom a ease is granted - the tenant. Lessor - The person who grants a ease - the andord. Licensed Conveyancer - An aternative to using a soicitor, they speciaise in property ownership transfer. Life Assurance - Type of insurance that wi pay an amount to your estate when you die. This can be arranged to pay out a set ump sum or a decreasing amount that reduces in ine with a mortgage. Loan to Vaue - The amount of mortgage expressed as a percentage of the vaue of the property or purchase price, whichever is ower. For exampe, a mortgage of 80,000 on a purchase price of 100,000 woud be 80% LTV. You can usuay borrow up to 95% LTV athough this may vary on certain products. Loca Authority Search - Part of the conveyancing process when you buy a property. It gives detais of any matters which, from the oca counci's point of view, affect the property. It reveas any proposed changes to the oca area, such as road improvements, and detais any panning permission given for the property. Member - A member is a customer who has a quaifying account such as savings or a mortgage with the Newcaste. Our customers are 'members' because we are a mutua society. Mortgage - A mortgage is a oan secured against a property. Mortgage Payment Protection Insurance (MPPI) - This insurance can cover your mortgage payments if you can t work because you've become unempoyed or because of an accident or iness. Mortgagee - The ender Mortgagor - The borrower Mortgage Advance - The actua amount of money we end as a mortgage Mortgage Deed - The ega document by which the ender secures the oan against the borrower's property. Mortgage Term - The ength of time over which you agree to repay your mortgage Negative Equity - This is when the amount you owe on a mortgage is greater than the vaue of your property. New Buid Property - The definition of a 'new buid' means a property that has not been occupied within two years of being newy constructed, converted or refurbished. NHBC Guarantee - A 10-year guarantee provided by the Nationa House Buiding Counci, that the buider wi put right serious defects on a newy-buit property. Offset Mortgage - An offset mortgage inks your savings baances with your mortgage. Rather than paying you interest on your savings, you can offset your savings against your mortgage. Overpayments - When you pay more than your norma monthy payment overpayments made to your mortgage aows you to pay off your mortgage earier. Pension Pan - An investment pan which can provide a ump sum and an income after retirement. A pension pan can be used as a way of providing a ump sum to repay the capita of an interest ony mortgage. Persona Possessions - Cover for accidenta oss or damage to items that you usuay take out of your home. Portabe Mortgage - If a mortgage is 'portabe', it can be transferred from one property to another. Property Vauation - When you appy for a mortgage we may ask you to pay a vauation fee to cover the cost of vauing your property. The vauation fee is payabe prior to vauation and is non-refundabe if the vauation is carried out. The vauation is very basic and is carried out for our benefit. We strongy recommend that you have a more thorough survey undertaken, such as a Homebuyer Report as this wi te you about the quaity and condition of the house you want to buy. Prudentia Reguation Authority (PRA) - The PRA works aongside the Financia Conduct Authority (FCA) creating a twin peaks reguatory structure in the UK. Rebuid Cost - This is the cost of rebuiding your home if it is damaged or destroyed by a number of different events such as storm, fire, food and subsidence. The reinstatement vaue is not the same thing as market price. The reinstatement vaue is the cost to fuy rebuid your home, incuding site cearance and ega fees. The cost of rebuiding your home varies, depending on where you ive. Redeem/Redemption - To pay off the outstanding baance of a mortgage in fu Remortgage - Transferring your mortgage from one ender to another without moving house is known as 'remortgaging'. Repayment (Capita & Interest) Mortgage - This is the most common way to repay your mortgage. Your reguar repayment is made up of some of the amount borrowed pus interest every month. It means your mortgage wi be repaid in fu by the end of the term providing a payments are maintained in fu and on time. Repayment Vehice/Strategy - This is the means by which you choose to pay off the capita on an Interest Ony mortgage when the mortgage term comes to an end. Pease note that currenty the Society does not offer Interest Ony mortgages. Reservation Fee - A reservation fee is payabe on some mortgage products and is charged to reserve a particuar mortgage product. This fee is non-refundabe and is payabe upfront. Repossessed - This is where a property is taken by the ender if the borrower fais to make the mortgage repayments. The property is then sod so the ender can get their money back. Seaing Fee - A fee charged by the ender for seaing your deeds. Searches - Checks carried out during the conveyancing process to determine any panning proposas or other matters which might affect the future saabiity of the property. Another search is carried out after the exchange of contracts to check that the borrower is not bankrupt. Stamp Duty - This is a Government tax which you wi have to pay if the price of the property you are buying is over 125,000. Standard Variabe Rate - A Standard Variabe Rate (SVR) is a rate of interest that is determined by your ender. The rate can increase or decrease at any time, which means your payments coud aso fuctuate. Most mortgage deas revert to SVR when your current fixed or tracker dea comes to an end. Structura Survey - A comprehensive survey carried out by a professiona surveyor on your behaf, to thoroughy examine the condition of a property. Subject to Contract - The phrase used before exchange of contracts which aows either party to withdraw without incurring a penaty. Sum Assured - The amount paid out on the death of a poicy hoder. Surveyor/Vauer - The person quaified by the Roya Institution of Chartered Surveyors or the Incorporated Society of Vauers and Auctioneers to carry out vauations and surveys of properties. Switch and Fix - Some of our base rate tracker products offer the option to switch to a fixed rate at any point in the fixed rate period, without paying Eary Repayment Charges on the tracker mortgage. Teegraphic Transfer - Aso known as a CHAPS transfer, this term is used to refer to sending funds from one bank to another eectronicay. Term of Mortgage - The number of years that you agree to repay your mortgage over. Tie in Period - The period of time you woud need to remain on certain mortgage products to avoid an eary repayment charge. Tite Deeds/Tite Documents - The documents which show proof of ownership. Underpayments - On some mortgages you can arrange to pay ess than your norma monthy subscriptions for a imited period, up to your agreed borrowing imit. Pease see product detais for more information. Vauation - This is the basic assessment that is carried out on a property. It enabes the Newcaste to decide whether to end on the property by assessing its condition and ikey vaue. This basic vauation is for the enders benefit ony. We woud recommend that you have a more detaied survey such as a homebuyers report or a fu structura survey. Vauation Fee - The charge for obtaining a vauation report of a property. The fee increases with the vaue of the property and is payabe upon appication