Mortgage Glossary Index

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Salary
The money you receive from your employment. Commission, overtime and bonuses are not normally considered as part of your gross income by the lender, unless you receive them at a guaranteed level. Any supplementary payment that is not guaranteed but which can be shown to remain above a certain level over a period of time can sometimes be taken into account, though many lenders will only incorporate a portion of this money into the calculation.

Scheme switch
The transfer of your debt from one mortgage product to another one offered by the same provider. A fee is usually charged by your original lender for this.

Security
A piece of property designated as collateral.

Self-build mortgage
Mortgage for those who wish to build their own home, renovate or convert their existing home. Funds are normally released in stages as work progresses following a satisfactory progress report from an architect.

Self-certification mortgage
Mainly for people whose income is difficult to assess using the standard method adopted by most conventional mortgage lenders. Bonuses, commission and seasonal work can cause income to vary over time or be difficult to guarantee and this may not be considered acceptable in order to get a loan. The main groups of people that opt for self-certification mortgages are: Self-employed and unsalaried company directors, contract workers (increasingly common in technology-based industries), commission-based workers (often in sales, recruitment etc.), people with seasonal earnings. The interest rate you are charged will be higher to compensate the lender for the increased risk.

Self-employed 
A person who operates as a sole trader or as part of a partnership. 

Shared-appreciation mortgage
A loan that allows a lender or other party to share in the borrower's profits when the home is sold.

Shared-equity transaction
A transaction in which two buyers purchase a property, one as a resident co-owner and the other as an investor co-owner.

Solicitor's letter fee
This is charged when your account falls in arrear and the lenders instruct solicitors to act on their behalf. Costs £20 - £30.

Stamp duty
Stamp duty is a government tax for the privilege of buying a house. Currently the tax is 1% of the property's value for those valued at between £60,000 and £249,000, 3% for properties valued between £250k - £500k and 5% over £500k.

Standard payment calculation
A calculation that is used to determine the monthly payment necessary to repay the balance of a home loan in equal installments.

Standard Variable Rate
The Standard Variable Rate is the rate which many mortgages revert to after the introductory offer, fixed rate or discount period is over. They are the simplest and most traditional mortgage product with no upper or lower limit on the rate charged, and the bank can raise or lower the rate at their discretion (though usually this is done broadly in line with the base rate).

Standing mortgage
An interest only mortgage where no arrangements are made at the outset for the repayment of the loan. If a specific investment vehicle has not been arranged to provide funds for this purpose, the borrower will have to repay the loan by some other means. If the capital is not repaid, the lender can repossess the property and sell it to recover as much of the debt as possible.

Standing order
A regular payment for a fixed amount that you can ask us to make from your account to another specified account.

Stepped discount mortgage
Where the discount is, for example, fixed at one level for one year and then a slightly lesser level for two further years. Remember it is the percentage discount that is stepped and not the monetary amount, so your repayment can still vary.

Stepped fixed rate mortgage
Where the interest is, for example, fixed at one level for one year and then a slightly higher level for two further years. This is not as common as finding stepped discounted mortgages.

Surrender
The process of cashing in an unwanted endowment policy with the insurer who sold it to you. Doing this often produces a poor return for the money invested to date in the policy's early years.

Surrender value
The amount received when converting an investment, such as an endowment, into cash.

SVR
The Standard Variable Rate is the rate which many mortgages revert to after the introductory offer, fixed rate or discount period is over. They are the simplest and most traditional mortgage product with no upper or lower limit on the rate charged, and the bank can raise or lower the rate at their discretion (though usually this is done broadly in line with the base rate).