Mortgage Glossary

An amortized loan payment first pays off the relevant interest expense for the period, after which the remainder of the payment reduces the principal.

Arrears also refers to debt or loan obligations that are overdue. For example, if you are two months late on your mortgage payment, your loan would be “two months in arrears.”

In financial accounting an asset is any resource that is owned by the asset owner or the business.

See types of loans here. A bona fide loan is a debt that the borrower has an obligation to repay and expresses his or her intention to repay. The bona fide nature of a loan must be verified and documented in the case file.

Break costs are fees charged by lenders for fixed interest rate loans when you pay over the agreed amount or pay off the loan entirely. When this occurs then you will be charged a break cost. This cost should be outlined up front in your agreement.

See types of loans here. A bridging loan, or bridging finance, is a short term loan that finances the purchase of a new property while you are selling your existing property.

A budget is a financial plan for a defined period, often one year. A sound budget will include planned sales volumes and revenues, cost of sales and overheads, resource quantities, stock and assets, liabilities and cash flows. ... It may include a budget surplus, providing money for future use or the unexpected, or a deficit in which outgoing costs exceed income.

A tax levied on profit from the sale of assets such as shares and investment property.