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Mortgage glossary listings for S

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

sealing fee
see discharge fee.

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.

- 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.





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