Mortgage glossary (UK)
Plain-English definitions of the terms that decide what a remortgage really costs. Last checked 2 November 2026.
Mortgage paperwork uses a small set of words that carry a lot of money: the early repayment charge that applies if you leave a deal early, the standard variable rate you move onto if you do nothing, the loan to value band that sets which rates you are offered, and the documents, such as the ESIS illustration, where those figures are written down. This glossary explains each one in a few sentences, so you can read your own offer with more confidence.
Every entry follows the same shape: a short definition first, then a worked UK EXAMPLE using the site’s shared case (a £185,000 balance with 22 years left), how the term affects a remortgage, common mistakes and edge cases, and links to the calculator and guides that go further. Entries name an independent source, usually MoneyHelper or the FCA, so you can check the wording for yourself.
Definitions are written for this site in plain English. They are not the legal wording in your mortgage offer, and the figures marked EXAMPLE are illustrative scenarios rather than quotes. If a definition here and your offer disagree, the offer wins. New to remortgaging? Start with when to remortgage or put your own numbers into the true cost calculator. Ads stay off the glossary.
All terms
- Early repayment charge (ERC)
- A fee some lenders charge if you repay some or all of a mortgage during a deal period, often calculated as a percentage of the balance or as months of interest.
- Loan to value (LTV)
- LTV (loan to value) is your mortgage balance divided by the property value, as a percentage. UK lenders price many products in LTV bands (for example up to 60%, 75%, 85%, 90%).
- Product transfer
- Moving to a new deal with your existing lender without a full remortgage to a different lender — often with lighter underwriting, but not always the cheapest rate.
- Standard variable rate (SVR)
- A lender’s own variable rate that many mortgages move onto when a fixed or discounted deal ends, if you do nothing.
- APRC
- The annual percentage rate of charge — a figure on a mortgage illustration that folds the interest rate and certain fees into one percentage, on stated assumptions.
- ESIS
- The European Standardised Information Sheet — a mortgage illustration format that sets out rate, payments, fees and early repayment charges in a fixed order.
- Product fee
- A charge for taking a particular mortgage deal, also called an arrangement or booking fee. It is separate from interest and from an early repayment charge.
- Cashback
- A lump sum a lender pays you for taking a deal. It reduces net fees. It can be clawed back if you leave early.
- Porting
- Taking an existing mortgage deal to a new property, if the lender agrees, instead of redeeming it and starting again.
- Further advance
- Extra borrowing from your current lender, secured on the same property, alongside the existing mortgage.
- Agreement in principle
- A lender’s early indication of what it might lend, based on the information you give. It is not an offer and not a guarantee.
- Stress rate
- A higher interest rate a lender uses to test whether the mortgage payment still looks affordable if rates rise.
- Redemption
- Paying off a mortgage, in full or in part. A full redemption is what happens when you remortgage to a new lender or sell.
- Mortgage illustration
- The personalised quote document for one specific deal, issued before you apply or when an offer is made. In the UK its required format is the ESIS; this entry covers how to use the document, and the ESIS entry covers the format.