S32 buy-out
bond
- a form of pension policy used to transfer
benefits from an occupational
scheme to a money purchase arrangement but
maintain the GMP element.
schedule of payments
- schedule of monthly payments under a
loan
second
charge
- a legal charge that ranks behind a
first charge, possibly to secure
a second mortgage, or a guarantee given
to secure other borrowings.
second home
- an alternative to your main residence -
subject to Capital Gains
Tax! See also: holiday home.
second mortgage
- a further loan on a property which
ranks after the first charge
mortgage.
second jobs
- sources of income other than an
individual's main employment.
self
-build
- a property, the construction of which
is controlled by the borrower;
not a finished unit. Loans on self build
properties will normally
be advanced in stage payments and are
subject to strict limits on
loan to value. A qualified architect will
need to be involved and
lenders will frequently look for the
builder to have NHBC or Foundation
15 guarantees.
self certification
- a mortgage loan where the borrower
makes a statement of his or
her income and the lender makes fewer
checks than normal on the
accuracy of this statement.
self employed
- working on one's own account. For
mortgage purposes this will
include partners in unlimited liability
businesses and professional
practices.
semi-commercial
- a property that has at least part
commercial use. A semi-commercial
mortgage is a loan on security that is
not entirely used for residential
purposes, e.g. a shop and upper part.
shared
equity
- method of property purchase in
partnership with a builder (vendor)
who offers an incentive for the
prospective buyer by accepting,
say, 95% of the purchase price to be paid
on completion and the
other 5% to be paid at some stated time
in the future. The builder
will normally register a second charge on
the property until the
remaining 5% has been paid. The 5% owing
may be on an interest free
basis or interest may accrue and be added
to the debt. Unlike shared
ownership, there is not normally a
monthly payment commitment.
shared ownership
- method of property purchase in
partnership with a Housing Association.
The borrower purchases part of the
property and rents the remainder
from the Housing Association. Also known
as co-ownership, this arrangement
is designed for people who could not
otherwise become homeowners.
Under most arrangements, the minimum
purchase amount is 25% of the
property value with the remainder
available to be purchased in blocks
of 25%.
sitting tenant
- a person having a legal right of
occupation, even if the property
changes ownership, and who is able to
apply to the local authority
to set a fair rent. Properties with
sitting tenants are generally
worth at least 30% - 40% less than their
open market value with
vacant possession.
sole occupancy
- a property that is occupied by the
borrower and his or her immediate
family only. No paying tenants are in
residence.
special
conditions
- specific terms, usually outlined on the
mortgage offer document,
that apply to a particular loan offer.
special status or
non-status
- unwilling or unable to provide the
necessary documentary evidence
of income and status.
stabilised rate
- mortgage where a notional rate is set
designed to be a true reflection
of the likely average rate over a period.
The borrower makes payments
each month based on this rate, but the
rate charged to the account
may vary in line with market conditions.
These products are designed
to protect borrowers from wildly
fluctuating interest rates. Whilst
highly popular in the late 1980s they
became discredited when some
lenders set unrealistically low notional
rates resulting in borrowers'
being faced with a considerable increase
in the loan amount outstanding.
stamp
duty land tax
- government land tax charged as a
percentage of the purchase price
of a property. Charged on all property
purchases over £125,000,
percentage varies by price.
standard
construction
- constructed of brick with a tile or
slate roof. Lenders may be
less inclined to provide funds on
properties of non-standard construction.
However, the definition is generally
accepted to extend to the main
mass-building techniques that have not
subsequently been found to
have greater potential for
defects.
standard
property
- a detached, semi-detached or terraced
house or bungalow.
start-up business
- a new business venture without a
trading record.
state benefits
- Any regular long-term payment from a
Government department. e.g.
State Pension, benefits for low income,
children, carers, incapacity
or sickness. Lenders vary greatly in
their treatment of additional
income and may therefore not accept the
full value of this income.
Provide the figure before tax is
deducted.
structural survey
- the widest form of inspection that can
be undertaken by a Chartered
surveyor. In the case of properties with
movement, lenders may require
a structural engineer's report. This is a
different type of survey
carried out by a Chartered Building
Engineer and should not be confused
with a structural survey.
studio flat
- flat comprising a single habitable
room, plus bathroom and possibly
separate kitchen. Many lenders will not
lend on these properties
as they are considered more difficult to
resell.
subsidy
(mortgage)
- a payment made by an employer to
subsidise the cost of interest
payments on a home loan. The amount and
extent of the subsidy will
vary from employer to employer and these
can be calculated in a
variety of different ways. It is
advisable to seek a specific statement
from your employer on the operation of
the arrangement.
sum assured
- the maximum amount payable under a
policy of insurance. In the
case of a life assurance policy this is
the amount payable upon
death. Under a general insurance policy
it is the maximum amount
that can be paid out in the event of a
claim. The sum assured under
a general policy must be adequate to
represent the full value of
goods at risk. If an insurer feels that a
policyholder has not declared
the full value of goods at risk and a
claim occurs, the insurer
may reduce the claim by applying average.
survey
fee
- see valuation
fee, home-buyer's survey fee.
