Advance
This is the money you have borrowed plus all
the additional fees.
Base
Rate In UK, this is the base interest
rate set by the Bank of England.
Bridging
Loan This is a temporary loan that
enables you to purchase your new property before
you are able to sell your old property.
Conveyance
This is the legal document that transfers ownership
of unregistered land to you.
Disbursements
These are all the fees of your solicitors, such
as stamp duty, land registry, search fees, etc.
Early
Redemption Charge / Pre-Payment Penalty / Redemption
Penalty This is the amount of money
you have to pay if you pay your mortgage in
full before the time finished.
Equity
This is the amount of your property in the
market minus all loans that it has.
Freehold
This means the ownership of a property
and the land.
Land
Registration This is a legal document
that records the ownership of a property and
land.
Legal
Charge This is a legal document that
records the data of the rightful owner of a
property or land.
Mortgage
Deed This is a legal document that
stated that the lender has a legal charge over
your property.
Mortgage
Payment Protection Insurance This
is the insurance that insures your mortgage
payment arrives on time in case you are unable
to pay your mortgage.
Sealing
Fee This is a fee made when the lender
releases the legal charge over your property.
Subject
To Contract This is an agreement
between seller and buyer before the actual contract
is made.
Legal
Aspects
There are essentially two types of legal mortgage.
Mortgage
by demise
In a mortgage by demise, the creditor becomes
the owner of the mortgaged property until the
loan is repaid in full (known as "redemption").
This kind of mortgage takes the form of a conveyance
of the property to the creditor, with a condition
that the property will be returned on redemption.
This
is an older form of legal mortgage and is less
common than a mortgage by legal charge. It is
no longer available in the UK, by virtue of
the Land Registration Act 2002.
Mortgage by legal charge
In a mortgage by legal charge, the debtor remains
the legal owner of the property, but the creditor
gains sufficient rights over it to enable them
to enforce their security, such as a right to
take possession of the property or sell it.
To
protect the lender, a mortgage by legal charge
is usually recorded in a public register. Since
mortgage debt is often the largest debt owed
by the debtor, banks and other mortgage lenders
run title searches of the real property to make
certain that there are no mortgages already
registered on the debtor's property which might
have higher priority. Tax liens, in some cases,
will come ahead of mortgages. For this reason,
if a borrower has delinquent property taxes,
the bank will often pay them to prevent the
lienholder from foreclosing and wiping out the
mortgage.
This
type of mortgage is common in the United States
and, since 1925, it has been the usual form
of mortgage in England and Wales (it is now
the only form - see above).
In
Scotland, the mortgage by legal charge is also
known as standard security. |
