Guidance
Jargon Guide
The Annual Percentage Rate (APR) is the yearly cost of your mortgage and includes interest, one-off fees plus on-going costs. You should use the APR to compare the cost of different loans on a "like-for-like" basis.
The Additional Security Fee is an insurance premium paid by you, based on the maximum additional cashflow required during your project. It protects the lender against loss in the event that your self build property is re-possessed prior to the completion of the build. It also enables them to release a higher percentage of the costs and money to you earlier than they would normally do.
The Bank Base Rate (BBR) is set by a special Bank of England committee, known as the Monetary Policy Committee, which meets at the beginning of each month. BBR is the interest rate at which the Bank of England is prepared to lend short-term money to financial institutions.
A discounted rate is one where the interest rate you are charged a rate less than your mortgage lender's standard variable rate (SVR). For example if the lender has an SVR of 5.45% and the discount is 0.75% you will pay 4.70%.
Many products are offered with highly competitive incentives at the start of a mortgage term. Such products can only be offered on the assumption that you keep your mortgage with that lender for a fixed period of time. In such circumstances, although you are of course free to move house and/or remortgage at any time, an early repayment charge will be incurred if you repay (or in some cases, partly repay the Capital within the Early Repayment Period).
The Financial Conduct Authority (FCA) is an independent non-governmental body, given statutory powers by the Financial Services and Markets Act 2000.
A Key Facts Illustration ensures that you receive specific details about a mortgage product in a consistent format allowing you to compare like with like. Your adviser will provide you with personalised product information in the form of a KFI, so that you are able to compare different products and decide whether to apply for a specific mortgage.
Often referred to as LTV, Loan to Value is a percentage figure used to express the amount of the loan as a proportion of the property's value. Different mortgage products can have different maximum LTV's - meaning that the minimum amount of deposit required (when buying a new home) can vary from one type of product to the next.
The Standard Variable Rate is a lender's own base lending rate. Mortgages which start at concessionary rates will usually revert to the Standard Variable Rate after the benefits period finishes.