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.

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This is my Index of Mortgage and Loan terms beginning with the letters M to P.

Mortgage
A mortgage is a large loan which is taken out specifically for the purpose of buying a property. The mortgage is paid back over o long period, usually about 25 years, and after this period the resident of the property is the legal owner. If repayments are missed then the home can legally be repossessed by the mortgage lender.
Mortgage Deed
This is the legal document establishing that you have a mortgage on your home or property.
Mortgage Term
The length of time in years which you take out to pay back your mortgage. Most commonly people take out a term of 25 years but it could be 5 years if you borrowed a small amount.
Negative Equity
This means the value of your property is lower than the amount you owe on your mortgage or secured on it. This will be a problem if you want to move or maybe considering either a Remortgage or a Secured Loan.
Non Status
This is another term for Adverse Credit, caused by having CCJ's, Arrears or missed payments. Non Status borrowers will find it harder to get a good rate than those with good credit history.
Online
Any transactions which are done over the internet are classed as Online. More and more people are choosing to sort out their finances online. Buying finance online can usually mean that you can save money as many lenders offer discounts for buying online.
Overpayments
This is when you can pay more than your normal monthly repayment. This means you can pay off your mortgage earlier and save on interest charges. There mite be a limited period when you might need to underpay.
Payment Break
This term is more commonly called a payment holiday. If agreed with your lender, Payments can be stopped for a limited period whilst you get over a financial tight spot. Also see Overpayments and Underpayments.
Personal Loan
A personal loan is a term used to cover secured loans and unsecured loans. This is a loan taken out for personal reasons such as holidays or new cars.
Poor Credit
This another term used to describe Credit Problems due to an adverse credit history. CCJ's, Mortgage Arrears and other credit debt repayment problems leads to a Poor Credit Rating. Poor Credit is more of an UK term with America more commonly using Bad Credit. When used to describe: Poor Credit Mortgages or Poor Credit Loans they mean Mortgages or Loans for people with Credit Problems or a Poor Credit History.