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Elite Orlando Homes - British Real Estate Glossary

To help your understanding U.S Real Estate terms in British terms we have listed some of the terms and their definitions that you maybe unfamiliar with.

Agreement of Sale (known in Britain as Counterpart Contracts) A written document in which a purchaser agrees to buy property, which the vendor agrees to sell, under certain agreed conditions. Also known as a "Sales Contract".
Application (same) A form commonly referred to as a 1003 form, used to apply for a mortgage and to provide information regarding a prospective mortgagor and the proposed security.
Appraisal (known in Britain as Valuation) An estimate of the market value of a piece of real estate made by a competent professional (the appraiser) who knows local property market and prices.
Approval (known in Britain as Agreement in Principle) An assessment made by British Mortgages Abroad of an applicant's ability to pay for a home and confirmation of the amount the applicant may borrow.
Assessments (not recognized in Britain) Special and local taxes imposed upon property which benefits from an improvement that has been made in the area.
Binder (not recognized in Britain) An agreement to consider the purchase of real estate. The agreement is secured and backed by a cash deposit as evidence of good faith on the part of the purchaser.
Cash-Out Refinance (known in Britain as Equity Release) A refinance transaction in which the amount of money received from the new loan exceeds the total of the money needed to repay the existing first mortgage, closing costs and the amount required to redeem other mortgages against the property. In short, a refinance transaction in which the borrower receives additional cash that can be used for any acceptable purpose.
Certificate of Title (known in Britain as Title Deeds) A written document stating that the title to a piece of property is legally vested in the present owner.
Clear Title (same and also known in Britain as Unencumbered) Title not burdened by mortgages, charges (liens) or legal questions.
Closing (known in Britain as Completion) In property transactions, the delivery of a deed, the payment of the purchase price, the signing of notes, and the paying of closing costs, which completes the transaction.
Closing Costs (known in Britain as Disbursements) The various expenses involved in closing a property transaction that are in addition to the purchase price. Closing costs will include title insurance fees and other relevant charges such as a Credit Report fee.
Closing Statement (known in Britain as Settlement Statement) Can be known as the 'HUD-I'. The final statement of costs to be paid to close a loan or to purchase a property.
Commission (known in Britain as Procuration Fee) An agent's fee for negotiating a real estate or loan transaction, often expressed as a percentage of the purchase price or the loan amount.
Commitment Letter (known in Britain as Offer of Advance) A formal offer by the lender which states the terms under which it has been agreed to lend money. Also known as a 'loan commitment.' This letter will indicate the conditions that must be satisfied before release of funds.
Condominium (known in Britain as Flat) A structure of two or more housing units. Only interior area of a particular unit is individually owned. All the owners of the individual units jointly own the remainder of the property (land, building and other amenities).
Contingency (known in Britain as Pre-Contractual Stipulation) A clause or condition within a contract stating what the buyer or seller must satisfy before the purchase can be completed.
Down Payment (known in Britain as Deposit) The agreed percentage of the purchase price a buyer pays, in cash, at the time the property transaction closes ('completes')
Escrow Disbursements (not recognized in Britain) Use of escrow funds to pay real estate taxes, hazard insurance, mortgage insurance, and other property expenses as they become due.
Escrow Fee (not recognized in Britain) Fee charged by the escrow company for handling escrow activities including paying off mortgages and clearing title and other debts.
Fair Market Value (known in Britain as Open Market Value) A figure that is the highest amount a purchaser would agree to pay for a property and the lowest amount the vendor would be prepared to sell at.
Finance Charge (known in Britain as Total Charge for Credit) Charges levied by British Mortgages Abroad that include ail of the interest due over the life of a loan, in addition to certain other charges related to a loan.
Flood Certificate(not recognized in Britain) A certificate that identifies those properties situated in "special flood hazard areas" and may require flood insurance to be arranged.
Good Faith Estimate (not recognized in Britain) A disclosure that must be given to all mortgage loan applicants within three business days of an application. It is an accurate estimate of all costs likely to be incurred at closing.
HUD (not recognized in Britain) The U.S. Department of Housing and Urban Development.
Hazard Insurance (known in Britain as Building Insurance) Insurance protecting against loss to property caused by fire, some natural causes, vandalism, etc., depending upon the terms of the policy.
Homeowner's Insurance Declaration (known in Britain as Insurance Schedule) A document accompanying a homeowner's insurance policy whose purpose is to verify that the property quoted is insured.
Income Property (known in Britain as Rental Property) Properties owned with intention of producing an income. Also referred to as 'non-owner occupied property' or 'rental property.'
Installment (known in Britain as Mortgage payment) The regular monthly payment that a borrower agrees to British Mortgages Abroad.
Insurance Schedulesee 'Homeowner's Insurance Declaration'.
Interest (same) Money paid to the lender for the use of borrowed funds, usually expressed as an annual percentage.
Loan Processing (known in Britain as Underwriting) Steps taken by British Mortgages Abroad from the time a loan application is received to the time the application is approved or declined. This process includes receiving the application, credit searches (investigation) and the overall underwriting assessment of the application.
Loan Terms (known in Britain as Mortgage Conditions) Necessary conditions of a loan which specify the amount borrowed, interest rate, maturity, method of repayment, etc.
Loan To Value (LTV) The percentage size of the loan in relation to the value of the property.
Low-Documentation (known in Britain as Self Declaration) Below a stated LTV, British Mortgages Abroad only require the applicant to state the source and the affordability of the mortgage applied for, without providing supporting documentation pay slips or trading accounts.
Market Value (known in Britain as Open Market Value) Also known as 'Fair Market Value.' The professionally considered estimated value of the property, which a seller could expect to receive under normal conditions.
Maturity (known in Britain as Loan Term) The term of a loan, or the number or years for which the loan funds are advanced.
Origination Date (known in Britain as Completion date) The date on which the loan is funded.
Origination Fee (known in Britain as Application Fee) A fee charged by the lender to cover the administrative costs of setting up a mortgage. This will include the preparation of documents and certain processing expenses in connection with completing a mortgage account.
Payoff (known in Britain as Redemption) Complete repayment/settlement of the principal balance along with interest and any other amounts due. The payoff of an account occurs either over the full term of the mortgage, through monthly repayments, or through early redemption.
Planned Unit Developments (PUD) (Not recognized in Britain) A subdivision of five or more individually owned lots with one or more other parcels owned in common or with reciprocal rights in one or more other parcels.
Pre-Approval (known in Britain as Decision in Principle) A process in which British Mortgages Abroad will offer a decision in principle. This opinion is based entirely on the credit search history available to British Mortgages Abroad. The pre-approval is not binding and not necessarily accurate because British Mortgages Abroad will not have yet verified the application details.
Preliminary Title Report (not recognized in Britain) A report made by a title company stating whether there are any other claims to ownership of a property. A necessary step before a mortgage loan can be approved.
Prepaids (known in Britain as Prepayments) Those expenses of property which are paid in advance of their due date and will usually be pro-rated upon sale, such as taxes, insurance, rent, etc.
Prepayment Clause (known in Britain as a Redemption Penalty Clause) A clause that confirms the amount of the principal balance of an account the borrower may pay earlier than expected with or without penalty. The terms acceptable to British Mortgages Abroad vary according to the product selected.
Prepayment Penalty (known in Britain as Redemption Penalty) A charge a borrower pays to redeem or part redeem a loan before it is due.
Promissory NoteYour Loan Agreement with the Lender detailing all the rights, obligations and conditions of the Loan.
Realtor (known in Britain as Estate Agent/Property Developer) A real estate broker or an associate holding active membership in a real estate board affiliated with the National Association of Realtors.
Refinancing (known in Britain as Remortgaging) Taking out a new loan to pay off an existing mortgage. This is usually done to obtain a lower interest rate or to borrow further funds against the equity in a property that may have built up since the original purchase.
Sales Contract (known in Britain as Purchase Contract) A written agreement between the vendor and purchaser stating the conditions that need satisfying for the sale to complete. Also known as an 'Agreement of Sale.'
Title Report (not recognized in Britain) A report that discloses whether there are any competing claims, liens {charges) or other ownership issues relating to the security address. This is done before title insurance is issued. Also known as a 'Preliminary Title Report'.
Truth-in-Lending Act (TILA) A law applicable in the United States requiring disclosure of the credit terms of finance transactions using a recognized format. This is intended to help borrowers compare the lending costs, terms and conditions of different lenders. Also known as 'Regulation Z.'