Buying a home is exciting, but it can also feel like you're learning a whole new language.
From the moment you start speaking to mortgage lenders and estate agents through to exchanging contracts and collecting the keys, you'll come across terms that may be completely unfamiliar — and sometimes they aren't explained as clearly as they could be.
At JW Wood, we believe buying a home should feel straightforward. So, we've put together a simple guide to some of the property jargon you're most likely to come across during your move.
Agreement in Principle (AIP)
An Agreement in Principle, sometimes called a Mortgage in Principle, is an indication from a lender of how much they may be prepared to lend you.
It isn't a formal mortgage offer and isn't legally binding, but having one in place can show sellers that you're serious about buying and have already considered your finances.
Chain
A property chain is created when your purchase depends on another property transaction going through — for example, if the person you're buying from is also buying another home.
The longer the chain, the more opportunities there are for delays, which is why chain-free buyers can sometimes be particularly attractive to sellers.
Conveyancing
Conveyancing is the legal process involved in transferring a property from one owner to another.
Your solicitor or licensed conveyancer will deal with contracts, searches, enquiries and the transfer of funds, helping to make sure everything is legally in order before you become the owner.
Exchange of contracts
Exchange is one of the key milestones in the buying process.
This is the point at which contracts are formally exchanged and the purchase becomes legally binding. A completion date is also agreed.
Until contracts have been exchanged, either party can generally withdraw from the transaction.
Completion
Completion is the day you've been waiting for.
This is when the remaining funds are transferred, ownership officially passes to you and the keys can be handed over. In simple terms, completion is the day the property becomes yours.
Gazumping
Gazumping is when a seller accepts a higher offer from another buyer after already accepting your offer.
It can happen because an accepted offer isn't legally binding until contracts have been exchanged. Acting quickly after an offer is accepted — including instructing your solicitor and progressing your mortgage application — can help keep things moving.
Freehold and leasehold
These two terms describe how you own a property.
Freehold generally means you own the property and the land it stands on outright.
Leasehold means you own the property for a fixed period under the terms of a lease, but not the land itself. Flats are commonly leasehold, and there may be additional costs such as service charges or ground rent.
It's important to understand exactly what you're buying before making an offer.
Fixtures and fittings
You may hear an agent or solicitor talk about fixtures and fittings when discussing what's included with a property.
Fixtures are generally items attached to the property, such as kitchen units or radiators. Fittings are usually removable items, such as curtains or freestanding appliances.
The TA10 form sets out what the seller intends to leave behind, so it's worth checking this carefully if there are particular items you'd like to remain.
Loan to Value (LTV)
Loan to Value, or LTV, is the percentage of the property's value that you're borrowing through your mortgage.
For example, if you have a 20% deposit and borrow the remaining 80%, your mortgage has an LTV of 80%.
Generally, a lower LTV can give you access to more competitive mortgage rates, although this depends on the lender and your circumstances.
Memorandum of Sale
Once an offer has been accepted, the estate agent will usually issue a Memorandum of Sale.
This records the agreed price and the details of the buyer and seller and is sent to the relevant parties, including their solicitors.
It is an important step, but it doesn't mean the sale is legally binding — that happens at exchange of contracts.
Searches
Property searches are checks carried out by your solicitor or conveyancer.
They can cover things such as local planning, drainage, environmental matters and other information that could affect the property.
Searches are an important part of the legal process because they can uncover issues you may not otherwise know about.
Sold Subject to Contract (SSTC)
You may see a property described as Sold Subject to Contract, or SSTC.
This means an offer has been accepted, but contracts have not yet been exchanged. The legal and financial work still needs to be completed before the transaction becomes legally binding.
Survey
A survey is an independent inspection of the property's condition.
It is different from the valuation carried out for a mortgage lender. A survey can give you a better understanding of the condition of the home and highlight potential issues that may need further investigation.
The type of survey that's appropriate will depend on the property and its age, condition and construction.
Vendor
Finally, you may hear the term vendor used frequently during your purchase.
Quite simply, the vendor is the person selling the property.
Buying a home doesn't have to feel complicated
There are plenty of unfamiliar words and phrases involved in buying a property, but understanding what they mean can make the whole process feel much more manageable.
And if you come across a term you're not sure about, don't be afraid to ask. At JW Wood, we're here to explain the process in plain English and help you understand what's happening at every stage of your move.
Want to know more?
We've created a Buyer’s Guide to Finding Home to take you through the buying journey from start to finish.
It covers everything from getting your finances in order and finding the right property to making an offer, arranging surveys and searches, exchanging contracts and moving into your new home. It also includes a more comprehensive jargon buster, plus information on the costs of buying and Stamp Duty.
[Read the full JW Wood Buyer’s Guide]
Whether you're buying your first home or moving for the fifth time, having the right information can make all the difference.
If you're looking for your next home across County Durham or Darlington, the JW Wood team is here to help.