Secured Loans & Mortgages

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Market conditions
Factors affecting the sale and purchase of homes at a particular point in time.

Market value
The price that a piece of property sells for at a particular point in time.

MIG - Mortgage Indemnity Guarantee
This is insurance for the lender paid by the consumer in a one-off payment, on 'high' LTV mortgages. This protects the lender in the event that you default on the loan and the sale of the property is not enough to repay the amount that they are owed. Some lenders will insist you pay this if your mortgage is for as low as 75% of the value of the property, but 90% is a more common level. Some lenders will not insist on it regardless of the loan value. You can often add this fee to the loan, but be aware that you will then be paying interest on it until the loan is repaid in full.

Monthly fee
A fee charged once a month.

Monthly repayment
This is the amount you pay to your lender each month towards the cost of your loan.

Mortgage
The name given to a loan used to buy a property.

Mortgage acceleration clause
A clause which allows a lender to demand that the entire balance of the loan be repaid in a lump sum under certain circumstances. The acceleration clause is usually triggered if the home is sold, title to the property is changed, the loan is refinanced or the borrower defaults on a scheduled payment.

Mortgage advance
The money loaned to the buyer, by the lender.

Mortgage arrears
The amount of back pay you owe your mortgage lender for failing to meet your mortgage requirements.

Mortgage cash deficit
Money still owed and the end of the repayment period of an interest only mortgage.

Mortgage cash surplus
Money left over at the end of a mortgage term, over and above the amount required to pay back the debt.

Mortgage certificate
The first document provided by an mortgage lender which shows any prospective seller that you can actually get a mortgage to cover the purchase price. It also provides a handy reference for some of the key features of your mortgage, and what your repayments will be for the introductory offer period, if there is one.

Mortgage code
The mortgage code is a set of standards defined by the Council of Mortgage Lenders, that lenders voluntarily subscribe to. It sets out codes of conduct on how a lender or intermediary should act when arranging your mortgage, as well as how you should be dealt with once your mortgage is in place. It also tells you how to complain in the event of a lender not keeping to the code and who to complain to.

Mortgage debt
The amount outstanding on your mortgage.

Mortgage deed
This is the agreement which explains the conditions of the mortgage (loan). It is a document to be signed by all parties to the remortgage on your property, and will be sent to HM Land Registry to register the remortgage.

Mortgage incentives
The lender may offer a discount or fee-free period on buildings insurance, accident and sickness insurance, redundancy insurance, or payment protection insurance. This is often done to encourage you to take up the policy, which you are then fairly likely to keep in the longer term. Other common incentives include a free valuation and money towards solicitor's fees.

Mortgage lien
The unpaid balance on the mortgage loan.

Mortgage payment protection insurance (MPPI)
An MPPI policy pays your mortgage for you if you become unable to work for an extended period of time, as a result of redundancy, accident, sickness or disability. It should provide enough income to cover all your monthly mortgage expenses. If you have a repayment mortgage, this should be your capital and interest repayment and if you have an interest-only mortgage, the MPPI should cover your interest payment as well as your normal monthly contribution to the investment vehicle that will repay your loan.

Mortgage reference fee
If you apply for a remortgage or a new mortgage, the new lender will want a mortgage reference from your existing lender. You will probably have to pay for this. Costs £20 - £50

Mortgage term
The period over which the mortgage loan is to be repaid.

Mortgage types
For example, repayment or interest. Or fixed, capped, tracker, discount or stepped rate etc.

Mortgagee
A bank or other financial institution that lends money to the borrower. The borrower is considered the mortgagor.

Mortgagor
The mortgagor is another term for the borrower.

MPC
Monetary Policy Committee of the Bank of England. Meets monthly to discuss and alter interest rates etc.

Multifamily mortgage
A mortgage on a multifamily dwelling with more than four families, typically an apartment building.

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