Merlin Mortgage Management

A I B I C I D I E I F I G I H I i I J I K I L I M I N I O I P I Q I R I S I T I U I V I W I X I Y I Z

(C)

Capital and Interest Mortgages : With this method the monthly mortgage repayments pay off both the initial loan amount and the interest that is charged upon it. At the end of the loan term, the entire debt will be repaid.
Also known as: Repayment Mortgage

Capital Rest Period : This is the regularity with which a Lender calculates the outstanding balance on mortgages, and hence the size of the monthly repayments. It is usually annually, monthly or daily. With Capital and Interest Mortgages this can be important; an annual interest calculation means that the borrower will pay interest on capital repayments that have been made in the course of that year. In contrast a daily or monthly interest calculation means that the balance, and consequently the interest charged, will reduce with every capital repayment made.

Capped Rate Mortgage : This is a mortgage that is guaranteed not to rise above a specific rate (the'cap') within a set period. Unless this is combined with another rate, such as a Discount or Tracker, the Lender's SVR will be charged if it is lower than the capped rate. If it rises above the ceiling, the rate charged will remain at the capped level. There are often Early Repayment Charges applicable if the loan is repaid within the capped period.

Cashback Mortgage : This is a mortgage in which the Lender refunds a sum of money, either as a percentage of the loan or a flat figure, to the borrower upon Completion. With this kind of offer the borrower will typically be tied to the Lender's SVR by Early Repayment Charges necessitating repayment of the cashback if the loan is repaid within a set period.

Completion : This is the moment when a transfer of property has legally taken place, after all legal documentation has been completed and funds have been transferred from the buyers solicitor to the seller's solicitor.

Contents Insurance : See Buildings and Contents Insurance

Conveyancing : This is the legal process whereby ownership of the property is transferred.

Current Account Mortgage : This is a fully Flexible Mortgage combined with a current account. Money in the current account is automatically set against the mortgage balance and interest is only charged on the outstanding amount, meaning interest payments are reduced.