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Early Redemption Fee

This is often associated with fixed, capped, discounted or cash-back mortgages. If you pay off your mortgage early, then you may be charged a fee to do so. The lender gives you a package with benefits, but you must keep the mortgage with them for a minimum length of time. Some mortgages don't have any early redemption penalties.

Endowment

An Endowment Mortgage is a savings based mortgage with life assurance to protect the capital owed. Your repayment to your mortgage lender covers the interest due only and another payment is made to your endowment policy provider, to be invested by the lender. These were designed to allow you to pay a smaller monthly premium. At the end of the policy your invested amount should be enough to pay off the balance of your mortgage. However current Endowment Policy Holders have been notified that the final invested amount is unlikely to cover the final balance of their mortgage.

Equity

This is the difference between the amount you owe on your current mortgage and the current value of your property. This amount can be used in a Remortgage to allow you to do some home improvements, buy a new car, take a holiday of a lifetime or simply to consolidate your debts into one lower monthly payment.

Exchange of Contracts

This is the stage in the property transaction at which legally binding contracts are exchanged between the buyer and the seller. Once contracts are exchanged the vendor becomes legally obliged to sell and the purchaser to buy on the terms agreed.

Existing Liabilities

This term is used by lenders to define all other financial commitments apart from the existing mortgage. This will take into account such items as bank loans, HP, credit cards, maintenance payments (to ex-spouse) etc. Most lenders will take these items into account when assessing how much they are prepared to lend and will usually deduct 12 months payments from gross annual income before applying their normal income multipliers.