Jargon Buster
Valuation fee
A fee paid by a borrower to cover the cost of the Valuation
Report.
Valuation report
This is carried out for the purposes of mortgage and is
prepared for the lender. A survey will also help you to
find out independently whether the price is reasonable.
Your mortgage lender will almost certainly insist on a basic
valuation to make sure that the property is worth the amount
you are paying for it. They want to ensure that you will
be able to sell it again and therefore that it is a safe
investment. Although it is often referred to as a survey,
it doesn't go into nearly as much detail as a homebyuyer
or full survey would do.
Variable interest rate
A loan rate that moves up and down based on factors including
changes in the rate paid on bank certificates of deposit
or Treasury bills.
Variable rate mortgages
As you would expect from the name, variable mortgage rates
go up and down and generally don't stay at the same level
for too long. This is because the interest rate and subsequent
level of repayment varies with the lender's interest rate.
This is usually derived from Bank of England base rate or
some other index. One such index is the banks' base rate
- an average of the rates of several leading lenders.
Verification of deposit
As part of the loan process, a lender will ask a borrower's
bank to sign a statement verifying the borrower's account
balances and history.
Verification of employment
As part of the loan process, a lender will ask the borrower's
employer for confirmation of the borrower's position and
salary.
