The following is a listing of words commonly used by
lenders and mortgage brokers. We have tried to give
a brief and simple explanation so that you may have
a better understanding of the process. For a more
detailed explanation we suggest that you refer to
your solicitor or accountant.
ASSET:
Something of value that you own such as a
car or a house etc.
CAVEAT:
Not a mortgage but a charge that will
prohibit any dealings on the property
involved.
CLEAR TITLE:
This is a Title or Deed without any
encumbrances recorded. (See Deed or Title)
CONTRACT:
The document that you sign to sell or
purchase a home or other asset. Laws vary
from state to state regarding cooling off
periods etc, we suggest that before signing
any contract you consult a solicitor.
CONVEYANCING:
This describes the process where your
solicitor searches the title, council rates,
toxic waste records, future main roads
requirements, land tax and any other items
that your solicitor may deem appropriate for
your property. Please discuss these searches
with your solicitor as each situation will
be different.
DEED or TITLE:
These are mainly
an electronic record these days, but we
still talk about them as though a tangible
record exists. In past times there actually
was a parchment style document that recorded
the current and past owners on the deed. In
some areas these may still be in existence.
ENCUMBERANCE:
A registered
charge such as a mortgage or caveat.
EQUITY:
A term used a lot by the Commonwealth Bank, it
is the amount of your house or property that
you own. IE. Market Value minus Loan Debt =
Equity
LIABILITY:
Usually a debt
such as a loan, credit card debt etc.
LOAN CONTRACT:
This is the
contract that you will sign with the lender.
It will give you all costs and fees that
apply to your loan. We recommend that you
familiarise yourself with all of these items
as exit fees or deferred establishment fees
may apply if you repay the loan early.
MORTGAGE:
A registered charge over the title for a home,
unit or land.
SETTLEMENT:
A term used to
describe the moment when your solicitor
exchanges your money for the deeds and
documents to give you ownership of the
property that you are buying.
VENDOR:
The person or persons selling the property.
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