Mortgage and Insurance Jargon Buster
As with many industries, the mortgage and insurance world is full of unique terms, acronyms and phrases that can leave you scratching your head and heading straight to Google for answers.
At Inca Financial, we keep things simple and use plain English wherever possible. And when we can’t avoid the jargon, we’ll break it down clearly. No fluff, no confusion.
Here are some common terms to help you make sense of it all. We’ll keep this list updated as the industry evolves.
| Term | Definition | Pronunciation | Yorkshire Pronunciation |
|---|---|---|---|
| Adverse Credit | Poor credit history, like missed mortgage or loan payments, CCJs, or bankruptcy. May affect mortgage or insurance eligibility. | AD-vers CRED-it | AD-vurs CRED-it |
| Agricultural Restriction | A covenant restricting occupancy of a property to those working in agriculture. Often relevant for rural property investors. | AG-ri-cull-chur-uhl re-strick-shun | AG-ri-cull-chur RISTRICK-shun |
| APRC (Annual Percentage Rate of Charge) | Shows the total cost of borrowing, including interest and fees. Required on all mortgage quotes. | A-P-R-C | AY-pee-ARR-see |
| Arrangement Fee | Fee paid to a lender for arranging a mortgage, often with fixed, discount, or cashback deals. | uh-RAYN-jment FEE | uh-RAYNJ-munt FEE |
| ASU (Accident, Sickness & Unemployment Insurance) | Insurance covering mortgage payments if you can’t work due to accident, sickness, or unemployment. Also called MPPI. | A-S-U | AY-es-YOU |
| Base Rate Tracker | Variable-rate mortgage tied to the Bank of England Base Rate. Overpayments usually allowed with little or no penalty. | BASE rate TRACK-ur | BASE rate TRACK-ur |
| Booking Fee | Fee charged on some mortgages, often non-refundable or added to the mortgage debt. | BOOK-ing FEE | BOOK-ing FEE |
| Bridging Loan | Short-term loan to buy a property before selling another. Can be risky; professional advice is recommended. | BRIJ-ing LOAN | BRIJ-ing LOAN |
| Brokers Fee | Fee paid to an intermediary or advisor for finding the right mortgage. | BROH-kers FEE | BROH-kers FEE |
| Buy-to-Let | Mortgage for buying a property to rent out. Repayment often based on rental income, not personal income. | BY-to-LET | BY-to-LET |
| Capital and Interest | Monthly payments cover both interest and the loan amount. | CAP-it-tul and IN-trust | CAP-it-tul and IN-trust |
| Capped Rate | Interest rate that won’t go above a certain level for a fixed period, often 1–5 years. | CAPD rate | CAPD rate |
| Cashback | A payment you receive when taking out a mortgage, either a fixed amount or a percentage. | CASH-back | CASH-back |
| CCJ (County Court Judgment) | Legal decision for unpaid debts. Satisfied if debt is repaid. | C-C-JAY | C-C-JAY |
| Completion | When the sale of a property is final and you become the owner. | com-PLEE-shun | com-PLEE-shun |
| Contract | Legally binding agreement for property sale. Exchanging contracts commits both buyer and seller. | CON-trakt | CON-trakt |
| Conveyancing | Legal process of buying or selling property. | con-VAY-an-sing | con-VAY-an-sing |
| Credit Scoring | How lenders assess your financial risk for a mortgage. | CRED-it SCOR-ing | CRED-it SCOR-ing |
| Credit Search | Check a specialist company carries out to see if you have CCJs or poor credit. | CRED-it SEARCH | CRED-it SEARCH |
| Debt Consolidation | Combining high-interest debts into your mortgage. Can lower monthly payments but may be expensive long-term. | debt con-SOL-i-DAY-shun | debt con-SOL-i-DAY-shun |
| Deed | A legal document which is ‘signed, sealed and delivered’. Transfers property ownership. | DEED | DEED |
| Deposit | The amount of money you put towards buying your property. | dee-POH-sit | dee-POH-sit |
| Disbursements | A solicitor’s expenses such as land registry fees, searches, faxes, etc. | dis-BURSE-ments | dis-BURSE-ments |
| Discount Rate | An interest rate set below the standard variable rate for a set period, usually 1–5 years. | DIH-scount rate | DIH-scount rate |
| Early Redemption Charges | Fee charged if you repay your mortgage early or remortgage before the agreed date. | EAR-lee REE-demp-shun CHAR-jiz | EAR-lee REE-demp-shun CHAR-jiz |
| Equity | The value of a property not covered by the mortgage. | EH-kwit-ee | EH-kwit-ee |
| Releasing Equity | Increasing your mortgage to access extra funds for home improvements, holidays, etc. | ree-LEE-sing EH-kwit-ee | ree-LEE-sing EH-kwit-ee |
| Exchange of Contracts | The point at which buyer and seller sign and swap identical contracts. Legally binding. | eks-CHANGE of KON-trakts | eks-CHANGE of KON-trakts |
| Fixed Rate | Interest charged on a mortgage is set for an agreed period. | FIXD rate | FIXD rate |
| Flexible Mortgage | Interest rate is variable, calculated daily. Allows overpayments or payment holidays. | FLEKS-ih-bul MORT-gij | FLEKS-ih-bul MORT-gij |
| Freehold | You own both the property and the land it is on. | FREE-hold | FREE-hold |
| Gazumping | Seller accepts a higher offer from another buyer after accepting yours, before contracts are exchanged. | GAZ-ump-ing | GAZ-ump-ing |
| Guarantor | Person liable for the mortgage if borrower defaults. Usually a close family member. | GAR-un-tor | GAR-un-tor |
| Home Buyers Report | A property survey between a valuation and full survey. Gives peace of mind about property condition. | HOME BUY-ers REE-port | HOME BUY-ers REE-port |
| Income Multiples | The mortgage size calculated by multiplying the borrower’s income by a set figure. | IN-cum MUL-ti-pulls | IN-cum MUL-ti-pulls |
| Income Protection Insurance | Covers accident, sickness, and unemployment; provides monthly payments if unable to work. | IN-cum PRO-tek-shun IN-shur-ans | IN-cum PRO-tek-shun IN-shur-ans |
| Interest Only Mortgage | Borrower only pays interest during the mortgage term. Must ensure funds exist to repay at end. | IN-trest OHN-lee MORT-gij | IN-trest OHN-lee MORT-gij |
| Intermediary | A mortgage broker or advisor arranging the mortgage on behalf of the borrower. | in-ter-MEE-dee-air-ee | in-ter-MEE-dee-air-ee |
| Land Registry Fee | Fee paid to register property ownership. | LAND REE-jis-tree FEE | LAND REE-jis-tree FEE |
| Leasehold | Own the property for a set number of years, but not the land it is on. | LEASE-hold | LEASE-hold |
| Local Authority Search | Check for proposed developments, planning permissions, or enforcement notices. | LOH-cal au-THOR-it-ee SEARCH | LOH-cal au-THOR-it-ee SEARCH |
| LTV (Loan to Value) | Mortgage as a percentage of property value. LTV 90% = £45,000 mortgage on £50,000 property. | L-T-V | L-T-V |
| Mortgage | A loan to buy property, secured against the property itself. | MORT-gij | MORT-gij |
| Mortgagee | The company or organisation lending the money. | MORT-gij-ee | MORT-gij-ee |
| Mortgagor | The person taking out the mortgage. | MORT-gij-or | MORT-gij-or |
| MPPI (Mortgage Payment Protection Insurance) | Covers mortgage payments in case of accident, sickness, or unemployment. | M-P-P-I | M-P-P-I |
| Negative Equity | When you owe more on a property than it is worth. | NEG-uh-tiv EH-kwit-ee | NEG-uh-tiv EH-kwit-ee |
| Overpayment | Increasing monthly mortgage payments to repay loan faster, saving interest. | OH-ver-pay-ment | OH-ver-pay-ment |
| Payment Holiday | A period with no mortgage payments, usually for flexible mortgages with prior overpayments. | PAY-ment HOL-i-day | PAY-ment HOL-i-day |
| Portability | A mortgage that can be transferred when moving house. | POR-tuh-bil-i-tee | POR-tuh-bil-i-tee |
| Redemption | The process of paying off your mortgage, either on moving, remortgaging, or at term end. | ree-DEM-shun | ree-DEM-shun |
| Redemption Penalties | Penalties for early repayment of a mortgage before the agreed redemption period ends. | ree-DEM-shun PEN-uhl-tees | ree-DEM-shun PEN-uhl-tees |
| Renters Rights Act 2025 (UK) | UK law strengthening tenant protections, ending “no-fault” evictions, and improving rental standards. | RENT-ers RITES ACT | RENT-ers RITES ACT |
| Remortgage | Paying off one mortgage with a new mortgage using the same property as security. | ree-MORT-gij | ree-MORT-gij |
| Repayment | Monthly payments to cover both the amount borrowed and interest. | REE-pay-ment | REE-pay-ment |
| Repossession | Legal process where lender takes back property due to borrower default. | ree-poh-ZESH-un | ree-poh-ZESH-un |
| Right to Buy | Tenant in a council property may purchase it at a discount, depending on tenancy length. | RIGHT to BYE | RIGHT to BYE |
| Sealing Fee | Fee charged when repaying a mortgage. | SEE-ling FEE | SEE-ling FEE |
| Searches | Checks carried out during conveyancing with local authorities and official organisations. | SEARCH-iz | SEARCH-iz |
| Sonia Swap Rates | A benchmark interest rate used in mortgages and loans, replacing LIBOR in most contracts. | SON-ee-a SWAP rate | SON-ee-a SWAP rate |
| Shared Equity | First-time buyer owns part of the property and pays mortgage; housing association owns the rest and charges rent. | SHAYRD EH-kwit-ee | SHAYRD EH-kwit-ee |
| Stamp Duty Land Tax (SDLT) | Tax payable on property purchase by the buyer. | STAMP DOO-tee LAND TAX | STAMP DOO-tee LAND TAX |
| Structural Survey | Wide-ranging check of property by a professional surveyor to identify faults. | STRUK-chur-uhl SUR-vey | STRUK-chur-uhl SUR-vey |
| SVR (Standard Variable Rate) | Variable interest rate set by lender; repayments go up or down accordingly. | S-V-R | S-V-R |
| Term | The period over which the mortgage must be repaid. | TERM | TERM |
| Term Assurance | Insurance policy designed to repay mortgage on death of the insured. | TERM ASH-ur-ance | TERM ASH-ur-ance |
| Tie-in Period | Requirement to stay with lender for a set period; moving early may incur charges. | TIE-in PEER-ee-ud | TIE-in PEER-ee-ud |
| Title Deeds | Documents proving ownership of freehold or leasehold property. | TIE-tul DEEDS | TIE-tul DEEDS |
| Transfer Deed | Document that transfers property ownership once signed. | TRANS-fur DEED | TRANS-fur DEED |
| Unencumbered | Property owned outright with no mortgages or loans against it. | un-en-CUM-burd | un-en-CUM-burd |
| Valuation | Check of property to determine value and suitability for mortgage. | val-yoo-AY-shun | val-yoo-AY-shun |
| Valuation Fee | Fee paid to cover lender’s property valuation. | val-yoo-AY-shun FEE | val-yoo-AY-shun FEE |
| Variable Rate | Interest rate that changes over time; repayments adjust accordingly. | VAYR-ee-uh-bul rate | VAYR-ee-uh-bul rate |
| Vendor | Person selling the property. | VEN-dor | VEN-dor |