D
DEAs
(Domestic Energy Assessors) - Authorised
agent for the provision of Energy Performance Certificates
Debit
- On a closing statement, an amount charged; that
is, an amount that the debited party must pay.
Debt
- An obligation to repay a specified amount at a specified
time.
Decision
in Principle (DiP) - An indication of the
likely outcome of a loan application. Not a formal
offer, but includes a credit check with a credit reference
agency and an assessment of your ability to repay
the loan amount requested. See also AiP
Deed
- A written instrument that, when executed
and delivered, transfers ownership of a property.
Deed
of Covenant – An agreement in a deed
to transfer income from one person to another in a
tax efficient way
Deed
Restriction - Clauses in a deed limiting
the future uses of the property. Deed restrictions
may impose a vast variety of limitations and conditions,
for example, they may limit the density of buildings,
dictate the types of structures that can be erected
or prevent buildings from being used for specific
purposes or even from being used at all.
Default
- A failure to abide by the terms of the contract.
Generally, 30 days after the due date if payment is
not received, the mortgage is in default.
Deposit
- Monies used as a down-payment on a property.
Deposit
Protection Scheme – Government backed
scheme for holding a tenants deposit.
Depreciation
- Loss in value of an asset over its estimated useful
life.
Developer
- One who puts land to its most profitable
use, through the construction of improvements.
DG
(Double Glazing) – Refers to windows,
Two parallel layers ofglass separated by an air space.
Reduce heat loss and reduce noise
DiP
(Decision in Principle) - An indication of
the likely outcome of a loan application. Not a formal
offer, but includes a credit check with a credit reference
agency and an assessment of your ability to repay
the loan amount requested. (see AiP)
Direct
Debit – Method of payment for bills
via a bank account.
Disbursements
– Fees that must be paid to third parties
by solicitors
Discretionary
grounds for possession - Grounds that may
be cited in possession proceedings which allow the
court discretion as to whether or not to grant possession
– there are also eight mandatory grounds for
possession. The discretionary grounds cover circumstances
in which: the landlord has offered suitable alternative
accommodation on the same basis; there are rent arrears
but not of more than eight weeks (or two months if
the rent is paid monthly, or one quarter if paid quarterly);
there are persistent and continuing rent arrears;
the tenant has breached the terms of the tenancy agreement;
the tenant has neglected or damaged the property or
has sub-let; the tenant is causing nuisance to neighbours;
furniture supplied under the tenancy agreement has
been damaged; the accommodation is linked to employment
which has ended; and the tenant has knowingly or recklessly
made false statements on which the landlord has relied
in granting a tenancy
Discount
Rate - A unit of measurement used for various
loan charges; one point equals 1 percent of the amount
of the loan, discounted from the published bank standard
variable rate, for an agreed period from the start
of the mortgage.
Discounted
Rate Mortgage - Mortgage in which the lender
agrees a fixed discount off the normal variable rate
for a guaranteed period of time. Likely to include
penalties for early redemption
Domestic
Energy Assessors (DEAs) - Assessor authorised
to provide Energy Performance Certificates
Down
payment - Amount of payment in cash by the
purchaser. Traditionally the down payment on a building
was 10 percent of the total price.
DPC
(Damp Proof Course) – Horizontal barrier
in a wall of impermeable material to prevent moisture
rising by capillary action
DPM
(Damp proof Membrane) – Impervious
material such as mastic asphalt or a plastic sheet.
DSS
(Dept of Social Security) - Benefit Agency
responsible for maintenance payments to the unemployed.
Often avoided by many landlords as payments are always
in arrears and there is a mountain of red tape.
DTi
(Department of Trade and Industry) –
Government department concerned with business and
enterprise. A good resource for impartial advice
Due
Diligence - Process of making your own efforts
to ensure that all is well with the property, before
finalising a purchase. This involves getting comparables
for both rentals and property values in the area.
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E
EA
(Estate Agent) – Traditional method
of property purchase. Agent for the selling, renting
or management of homes, land and other buildings
Early
Repayment Charge (ERC) - A charge payable
of some mortgages to cover administration costs in
the event of a loan being repaid before the due date
Easement
– A right, such as a right of way,
which the owner of one property has over an adjoining
property
EDMO
(Empty Dwelling Management Order) –
May be made by a local housing authority in respect
of dwellings which are wholly unoccupied. An interim
EDMO is an order made by a local housing authority
to enable it to take steps for the purpose of securing
that a dwelling becomes and continues to be occupied.
A final EDMO is made in succession to an interim EDMO
for the purpose of securing that a dwelling is occupied
EOT
(End of Terrace) – The dwellings at
either end of a row or terrace of houses
EPC
(Energy Performance Certificate) - An assessment
of household energy usage and the extent to which
this can be lowered if the recommendations of the
Domestic Energy Assessor preparing the certificate
are adopted. Certificates giveproperties a rating
from A to G presented graphically in much the same
style as used for fridges, washing machines and other
white goods. Dwellings offered for sale must have
an EPC that is not more than 12 months old, and from
October 2008 rental properties must have a certificate
that is not more than 10 years old.
ERC
(Early Repayment Charge) - A charge payable
of some mortgages to cover administration costs in
the event of a loan being repaid before the due date.
ERRP
(Estimated Restricted Realisation Price)
– The amount of money expected to be achieved
within a short timescale from the sale of assets by
auction, tender or private treaty. Crisis figure.
Replaced forced sale value. See also BMV
Easements
- A right of use over the property of another.
A utility easement, for example, allows the utility
company to lay its lines across another’s property.
Emerging
market - Countries where the property market
is in its infancy. Usually no mortgages would be available,
roads and infrastructure would not be the best. Not
easy to get there (no cheap airlines yet). Possibly
waiting for entry into the Euro Zone
Encroachment
- An obstruction, building, or part of a building
that intrudes beyond a legal boundary onto neighbouring
private or public land, or a building extending beyond
the building line
Encumbrance
- Anything, (a mortgage, tax, or judgment lien, an
easement, or a restriction on the use of the land)
that may diminish the value or use and enjoyment of
a property
Endowment
Mortgage – An endowment life assurance
policy is often linked to a mortgage. Throughout the
term of the mortgage, payments made by the borrower
cover only the interest due on the loan. The capital
sum borrowed is paid back in one lump sum at the end
of the loan period, using the proceeds from an endowment
policy taken out at the start of the mortgage
Energy
Performance Certificate (EPC) - Assessment
of household energy usage. Certificates give properties
a rating from A to G and the extent to which this
can be lowered if the recommendations of the Domestic
Energy Assessor preparing the certificate are adopted.
Dwellings offered for sale must have an EPC that is
not more than 12 months old, and from October 2008
rental properties must have a certificate that is
not more than 10 years old.
Equity
- The difference between the value of your property
and the amount you actually borrowed.
Equity
Release – Schemes that allow you to
release some of the equity, or the value you have
built up in your home, without having to move out
or sell it on the open market. Also used to refer
to straightforward re-mortgaging
Escrow
Account - A bank account into which funds
are paid, usually for the fulfillment of a mortgage
or other contract.
Eviction
- A legal process to oust a tenant for possession
of property. In most cases it is illegal for a landlord
to evict a tenant without a court order. The Protection
from Eviction Act 1977 also protects tenants against
being forced to leave a property through harassment,
such as threats or physical violence, or through withdrawal
of services such as disconnecting the electrical supply
or refusing to carry out vital repairs
Evidence
of Title - Proof of ownership of property;
commonly a certificate of title, an abstract of title
with solicitor’s opinion.
Exchange
of Contracts - Point within conveyancing
process at which the agreement between a property
buyer and seller for transfer of title becomes binding
in law subject to penalties for non-completion.
EXCL
– Abbreviation. Excluding, not including
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F
Fair
Rent - Rent determined by the Rent Service
applicable to Regulated tenancies, set according to
local market conditions but any increase capped, except
where the landlord has made substantial improvements
to the property, by a formula based on the rate of
inflation.
F/F
(Fully Furnished) – Accommodation offered
in ready to move into condition including basic furniture,
white goods and equipment
FH
(F/H) - See Freehold –
Fiduciary
– (US) Having a duty to act primarily for another’s
benefit. If you hire a solicitor, for example, that
solicitor has a duty to act primarily for your benefit.
Fittings
– Fittings are items that are not attached to
the building or land and are not subject to the sale
unless they are specifically included, carpets and
curtains would normally be thought of as fittings
Fixed
Rate Mortgage - A mortgage in which the interest
rate is fixed for an agreed period (usually from two
to ten years) and it is unaffected by changes in the
lender’s variable rate. This means that during
the specified period, you will know exactly how much
your monthly repayments will be. At the end of this
period, interest on the mortgage will be charged at
the lender’s variable rate. Early repayment
charges may apply on these types of arrangements
Fixer-Upper
- A house which can be put on the market again after
some renovation.
Fixtures
- Items on a building or land that have become part
of the building or land and are therefore included
in the sale.Usually physically fixed to the building
such as shelves or fitted wardrobes. If it is firmly
secured onto the land or house and cannot be removed
without damage, then it qualifies as a fixture.
Flexible
Mortgage – A mortgage in which you
can vary the amount you pay each month and take breaks
from your monthly payments
Flip
- Purchase and immediate resale of property.
Foreclosure – (US) The sale of mortgaged property.
Proceeds from the sale go to the lien-holders as repayment.
Freehold
- A term which means that you own the property and
the land it is situated on outright.
FSA
(Financial services Authority) – The
main regulatory body for the UK financial services
industry
FSBO
(For Sale by Owner) - Popular acronym
FSS
(Full Structural Survey) – The most
comprehensive, and therefore most expensive, survey
available. A full structural survey will examine all
aspects of a property Normally reserved for properties
of unusual construction, older properties that have
been heavily extended.
FTB
(First Time Buyer) – A potential house
buyer who has not previously owned a property or who
has never taken out a mortgage before; often qualifies
for various discounts and incentives
Further
Advance - A secured loan to release equity
in your house or investment property for any purpose.
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G
Gazumping
– Gazumping is where a seller agrees to accept
your bid and then accepts a higher bid from someone
else
GCH
(Gas Cental Heating) – Provides Gas
powered warmth to the interior of a building from
one point to multiple rooms
GDN
(Garden) – Abbreviation. Outside space
belonging to a property
GDV
(Gross Development Value) – Final end
value of a development or project before deductions
Gearing
- To use a small amount of money to control a large
amount of money/asset. US=Leverage.
Gentrification
- Socio-economic rise of a neighbourhood.
GF
(G/F) Ground Floor – The floor of a
building nearest to the level of the ground around
the building
Good
Repair - Landlords are required by law to
keep their rented properties in good repair and fit
for human habitation. Should local environmental health
officers rule that a tenant’s health has been
affected by the state of living conditions, he or
she would be able to claim compensation from your
landlord
Grace
Period - A period of time granted by a loan
agreement during which default will not occur even
though payment is overdue. Your contract may or may
not have a grace period.
Gross
Return – The money made before the
subtraction of the costs of doing business.
Gross
ROCE (Gross Return On Capital Employed) –
Amount of financial return calculated from the annual
rent minus the annual interest cost divided by the
property purchase price and acquisition costs.
Gross
Yield – Amount of financial return
from property before expense deductions. Calculated
by dividing the annual rental figure by Property purchase
costs (including Acquisition costs)
Grounds for Possession - There are 17 grounds for
possession laid down in the Housing Act 1988, as amended
by the Housing Act 1996, that may be cited in possession
proceedings against a tenant. Eight are Mandatory
grounds for possession where the court is obliged
to award possession provided the landlord has complied
with the procedure set out in the Housing Acts and
has served the tenant with the appropriate notices.
Nine are Discretionary grounds for possession allowing
the court some leeway. Landlords may also seek possession
when it can be demonstrated that a tenant is no longer
using the accommodation as his or her principal home.
Ground
Rent - Rent payable by the owner of a leasehold
property to the freehold owner.
Guaranteed
Rental Income – Amount of income guaranteed
per year, make sure you are aware of who is the guarantor,
for how long and that there is a contract in place
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H
Harassment
- Harassment is a criminal offence under
the Protection from Eviction Act 1977. The term refers
to acts by a landlord or agent likely to interfere
with the peace or comfort of a tenant or involve the
withdrawal or withholding of services reasonably required
for occupation. Harassment can include the landlord
continually visiting the property or contacting tenants
HB
(Housing Benefit) - A means tested welfare
benefit administered by the local authority providing
eligible tenants assistance in meeting the cost of
rent. Helps tenants to pay their rent. All tenants,
Council, Housing Association or private, are eligible
to apply. How much help anyone receives depends on
their income and other circumstances. See also LHA
Higher
Lending Charge (HLC) - A charge due on a
mortgage with a LTV greater than 90%.
HIPs
- Home Information Packs. Introduced by Government
in 2007. Compulsory for every residential property
put on the market.
House of Multiple Occupation (HMO) – A property
occupied by five or more people. Each local council
has different licensingrequirements, See HMO
Housing
Associations – A provider of social
housing
Housing
Authority – Section of Local Government
responsible for social housing
HLC
(Higher Lending Charge) - charge due on a
mortgage with a Loan To Value (LTV) greater than 90%.
HMO
(House of Multiple Occupation) – Entire
houses or flats let to three or more tenants from
two or more households who share a kitchen, bathroom
or toilet. Houses converted entirely into bedsits
or other accommodation that is not self contained,
let to three or more tenants who form two or more
households and who share kitchen, bathroom or toilet
facilities. Converted houses containing one or more
flats which are not wholly self contained, occupied
by three or more tenants who form two or more households
and who share facilities; and buildings which have
been converted entirely into self contained flats
but the conversion did not meet the standards of the
1991 Building Regulations and more than one third
of the flats are let on short term tenancies In each
case the property must be used as the tenants’
only or main residence and it should be used solely
or mainly to house tenants. Properties let to students
and migrant workers will be treated as such tenants’
only or main residence. The same will apply to properties
which are used as domestic refuges. All of these properties
could be subject to mandatory or additional licensing
requirements, but not all are. It is only those that
are of three or more storeys with five or more occupants
that in fact require a licence In Scotland there is
a separate definition and all must be licensed
HMO
Licensing - In England and Wales a requirement
that larger houses in multiple occupation should be
licensed by local authorities came into effect on
6 April 2006. After 3 July 2006 it is an offence to
let properties caught by the mandatory licensing provisions
of the Housing Act 2004 without a licence which could
incur fines of up to £20,000
Homes
and Communities Agency - The new housing
and regeneration agency for England. They provide
funding for affordable housing and improve quality
of life by raising standards for the physical and
social environment.
Housing
Ombudsman - The Ombudsman can investigate
complaints and other matters referred to them and
make recommendations for action. They are independent
of the people and organisations they investigate.
They are impartial. Tenants can refer matters to the
Housing Ombudsman,
HPI
(House Price Index) - Published by Land Registry
using sales data collected on all residential housing
transactions in England and Wales.
HVAC
(Heating, Ventilation & Air Conditioning) - Acronim
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