Jargon Buster

The world of Finance is full of buzz words and Jargon. In this section I'll translate a whole rack of finance terms so you won't get caught out.

Go direct to: A-B | C-D | E-G | H-L | M-P | Q-S | T-Z | Jargon Index

This is my Index of Mortgage and Loan terms beginning with the letters C to D.

Capped Rate Mortgages
The maximum interest rate on a Capped Rate Mortgage is set over a period, usually a number of months or years. With a Capped Rate Mortgage, the interest you pay will not go above a certain level, however it may decrease as the base rate goes down. You will be locked into the mortgage for a set minimum time period, and you may incur charges if you switch.
Cash Back
Cash Back is an incentive which lenders use to try and make you take out their loan or mortgage. This will be a set amount or a percentage of the amount you borrow which you will receive back. You are probably paying for this cash back in the mortgage rate you pay.
CCJ (County Court Judgment)
If you have not made payment on any debt you have then you will be taken to Crown Court. If the debt isn't satisfied then a decision or judgment made in the County Court, normally for the non-payment of that debt will be registered on your credit file as a CCJ. If the debt is paid or satisfied and a satisfaction certificate obtained it will be noted on your credit file.
Completion
The final stage of the mortgage process and the day you get the keys becoming the new legal owner of your own home.
Consolidation (Debt Consolidation)
Debt Consolidation is a way of making your debts easier to handle. You take out one loan to pay off all your existing debts, leaving you with one monthly payment to make to repay the loan.
Conveyancing
The legal process of transferring ownership of the property. A conveyancer, usually a solicitor, deals with the contracts and property searches.
Credit Check
Whenever you apply for finance, your credit history will be checked. This will let the the lender know whether you are a high or low risk. A Credit Check will show up any credit problems you have such as CCJs or Defaults and will affect the rate which you are offered.
Credit History
Your Credit History is the record of any problems which you have experienced with finance. Any CCJs, Arrears or Defaults which you have suffered will be shown on your Credit History. A good Credit History will get you a lower rate when applying for finance.
Credit Scoring
This process is used by some lenders to determine what level of credit risk you are. They use a scoring system based on credit history; good or bad, length at current address, security, employment, income and answering these questions gives them a score or Credit Rating. Mainstream lenders only want high scores. However, it is possible to get finance with low score, but you will be given a much higher rate.
Defaults
If you have Defaulted on a loan or mortgage it means that you are more than 30 days behind the date your repayment was due. This will be marked on your credit history and would lead to a CCJ if no payment was received or received very late.
Deposit
The amount of money you put towards the purchase of the property. Most lenders will require at least 10% Deposit of the purchasing price. However some lenders will lend 100% or more but only to Status Applications with no credit history.