Shared Ownership glossary

A

Affordability Assessment – A review of your income, outgoings, and credit history to confirm you can afford the purchase. Also referred to as a stage 1 and 2 sign off. This will be completed with one of our professional mortgage brokers.

Agreement in Principle (AIP) – Also known as ‘Decision in Principle’ or ‘DIP’. A lender’s initial confirmation of how much you can borrow, based on a soft credit check.

Anti-Money Laundering (AML) Checks – Identity, proof and source-of-funds checks to ensure that funds used in a transaction are legitimate and not linked to criminal activity. Our AML checks are carried out with Thirdfort.

Arrangement Fee- Some lenders may ask for this fee for providing or ‘arranging’ a loan.

B

Broker - This is a person who advises on mortgages and loans, known as a ‘mortgage broker’. A mortgage broker will make sure that the repayments are affordable on your Shared Ownership mortgage.

Building Insurance/ Warranty – Covers the cost of repairing or rebuilding the structure of your home if it is structurally damaged or destroyed. This cover is set up by SNG on completion and the cost is included within your service charge (such as NHBC cover).

Building Regulations - Building regulations are rules that must be followed when building or altering homes to ensure they are safe and fit to live in. They cover key areas such as fire safety, structural integrity, sound insulation, ventilation, electrical safety, and the quality of materials and workmanship.

C

Cash purchase - When a buyer pays the full price for a property upfront without using a mortgage or any other form of financing.

CCJ - This stands for County Court Judgement. If you have a judgement against you for defaulting on a debt it may mean you are turned down for future loans or pay a higher interest rate.

Chain - A property chain is the sequence of buyers and sellers who are all linked because each person’s move depends on another transaction happening.

CML form - (Council of Mortgage Lenders form), also referred to as a Disclosure of Incentives Form (DIF), is a standard document used by lenders to confirm key details about a property, including its construction, warranty (such as NHBC), lease, and any incentives or obligations. This helps ensure the property meets mortgage lending requirements.

Completion – The final stage of the purchase when you receive keys and legal ownership of your share.

Completion on notice – when you have exchanged contracts prior to the property being build complete. Completion will be agreed ‘on notice’ once the property is build complete and ready to move into.

Completion statement - This is a financial breakdown of your purchase and all the related costs on completion. It ends by stating the amount of money your conveyancing solicitor needs from you to complete on your new home.

Contract - A legally binding agreement between buyer and seller that sets out the terms and conditions of the property purchase.

Contract Pack – This includes the contract, lease, conveyance plan and any other documents related to the property. This will be issued to your solicitor by SNG’s solicitor, and this will generally initiate the conveyancing to start. Following this, a 6-week exchange deadline will be agreed as standard.

Conveyance Plan - A detailed plan showing the boundaries and layout of the property as referenced in the lease or title documents.

Conveyancing – The legal process of transferring property ownership from seller to buyer.

Contents insurance - Contents insurance is a policy that covers the cost of repairing or replacing your personal belongings inside the home if they are damaged, lost, or stolen. We strongly advise you take out your own contents insurance when you move into your new home.

Covenants - A legal obligation attached to a property that requires the owner to either do something or refrain from doing something with the land or building.

D

Deeds - These are the legal documents that show the history of ownership of a property, including all past Transfers and Conveyances. Today, Title Deeds are stored electronically by the Land Registry, and the key information is recorded on the property’s Register of Title.

Default - This is a term used when you do not do as you agreed, e.g. failing to make a mortgage payment. If you fail to make mortgage payments (or default), your home could be repossessed.

Defect - A defect is work that does not meet a specification or standard required by a contract due to fault(s) in the work, materials or design, or because of deficiencies in the quality of the work. Examples of a defect: A leaking pipe, a window that won't close properly, or roof leaks.

Defects Period – This is a period of time during which the developer is liable to repair any genuine defects.

Deposit – The initial payment (usually 5–10% of your share’s value) paid at exchange of contracts.

Designated Protected Area (DPA) - A DPA is a protected rural area where Shared Ownership homes have restrictions (usually capped staircasing) to keep them affordable for future local buyers.

Developer – A house builder who has entered a contract to build a certain number of homes for SNG.

E

Energy Performance Certificate (EPC) – A document rating the property’s energy efficiency, valid for 10 years.

Enquiries - Questions raised by your solicitor to SNG’s solicitor to clarify details about the property and its legal title.

Equity - This is the portion of the property you own.

Exchange deadline – This is the date agreed once contracts have been issued to your solicitor, by which the exchange of contracts should take place. Our standard exchange deadline is six weeks, although this may vary depending on individual circumstances.

Exchange of Contracts – The point when the sale becomes legally binding and the deposit is paid.

Exchange on notice – Exchanging contracts prior to the property being build complete. This is very common with new build transactions. Notice will be served once the property is build-complete and ready to be moved into, you will then have 10 consecutive days to complete and be given the keys.

F

FCA – Financial Conduct Authority is the UK’s main regulator, concerned with consumer protection in the financial market. Sovereign Network Group is authorised and regulated by the Financial Conduct Authority.

Freehold – Owning the freehold means you own both the property and the land it stands on outright, with no time limit or lease obligations. You can own the freehold if you are able to staircase to 100% on a house. You will not be able to own the freehold for an apartment.

G

Gifted Deposit – Money given by a third party toward your purchase, subject to AML checks.

Grant funding - Grant funding, in the context of Shared Ownership, is money provided by Homes England to housing providers to help cover the capital costs of building new affordable and shared‑ownership homes, enabling these homes to be offered at lower, more accessible prices for buyers.

Greater London Authority – The Greater London Authority (GLA), led by the Mayor of London, sets the strategic framework, funding, and eligibility rules for affordable housing across the capital. This includes defining maximum household income thresholds to ensure that intermediate housing options remain affordable for working Londoners.

H

Handover – Also referred to as ‘practical completion’ or ‘build complete’. This is when the developer has completed the build and the property is ready to be moved into. The keys and ownership will then be passed over to SNG and if the legal transaction is ready, we can organise a completion date with you.

Homes England - Homes England is the government agency that oversees affordable housing by funding shared‑ownership schemes and providing the model leases that Shared Ownership landlords must use.

Housing Association (Registered Provider) – A not-for-profit organisation that provides affordable housing, such as SNG.

I

IFA – An Independent financial advisor is regulated by the FCA and can help with things like investments, pensions, mortgages, insurance, and general financial planning.

L

Land Registry - The Land Registry is the government department that records and maintains the official register of who owns land and property in England and Wales.

Lease - A legal agreement that sets out the terms and conditions for owning a share of a property and renting the remaining share from SNG.

Leasehold – You own the property for a fixed term under a lease agreement, but not the land it stands on, which remains owned by the freeholder.

Loan-to-Value (LTV) – The ratio of your mortgage amount to the property’s value.

Local Authority - A local authority is a legally established council responsible for providing public services and managing local governance within a specific area, such as a city, town, or district.

Local Connection - Local connection restrictions can apply in certain areas, meaning you need to live, work or have immediate family within the same local authority as the development. This is put in place by the local authority as part of the planning permission procedure.

Lodger - If a leaseholder or shared owner has a lodger, we do not consider this to be subletting, and permission is not required.

M

Memorandum of Sale (MOS) – This is a document issued after an offer is accepted that records the key details of a property sale so solicitors can begin the legal conveyancing process.

Mortgage – A loan secured against your share of the property. Once you’ve reserved your new home, you will need to begin your mortgage application with your chosen lender. Once the lender is satisfied with all the information provided and a mortgage valuation has been carried out, they will issue you with a full mortgage offer.

Mortgage lender - A bank, building society, or financial institution that provides funds to borrowers for purchasing property, secured against the property until the loan is repaid.

Mortgage valuation – a survey carried out on behalf of the mortgage lender to confirm its market value and ensure its suitable for the mortgage loan.

Nomination Period – The period during which SNG has the exclusive right to find a buyer for your resale. Information around this is contained within the Shared Ownership lease.

P

Pre-completion search – also referred to as an OS2 search or in some cases, OS1 search. Some solicitors will obtain this search (via the land registry), just before completion to ensure there are no new charges or entries against the title.

R

Resale - A resale Shared Ownership property is a home that was previously owned under the Shared Ownership scheme and is being sold back through the housing association or estate agent.

Reservation Fee – Once you’ve had the good news that your application for a property has been successful, you’ll receive a reservation form to complete which will require a £250 reservation fee to secure your new home. From this point, we aim for a 6-week exchange deadline.

Rent – Monthly payment to SNG for the share you do not own.

RICs Valuation - A property valuation carried out by a qualified surveyor in accordance with the Royal Institution of Chartered Surveyors.

S

Searches – Checks carried out and applied for by your solicitor to uncover important information about the property and surrounding area, such as legal restrictions, planning issues, or environmental risks. This includes a local authority search.

Service Charge – A monthly fee covering communal maintenance and building insurance. This also includes any payable ground rent.

Shared Ownership – A scheme allowing you to buy a share of a property and pay rent and service charge to SNG on the remainder.

Snagging – The process of identifying and fixing minor cosmetic issues or unfinished items before taking handover of the property. This ensures the property meets agreed standards and specifications. Examples of a snag: Paint splashes, minor surface scratches, or small hairline cracks in the plaster.

Solicitor – A legal professional who manages the conveyancing process. SNG has their own solicitors who act on their behalf during the property transaction, and you will also instruct your own solicitor to act on your behalf. SNG have an independent solicitor panel that you can instruct on your behalf.

Staircasing – Buying additional shares to increase ownership, up to 100%. In some cases, a restriction on staircasing applies. You can check with us if this applies to your property. There are four different types of staircasing transactions, including Interim Staircasing, Final Staircasing, Simultaneous Staircasing and Interim Staircasing on a Resale transaction. If you’d like to find out more, please contact us.

Stamp duty (SDLT) – Is a government tax you pay when buying property or land. The rate can vary depending on factors such as being a first-time buyer or the price of your home.

Subletting – Subletting is when a tenant who is renting a property, rents out all or part of that property to another person. If a request to sublet is made by a shared owner, the Leasehold Compliance Officer will request details of the reason for the subletting along with evidence to support their request (such as a Contract of Employment Letter).

Subject to Contract - Once an offer is accepted on a property, the property is ‘Sold Subject to Contract’ (SSTC). Customers who are already homeowners will need to make sure they are SSTC before applying for a new Shared Ownership home with SNG.

T

Tenant - A person or persons who is entitled to occupy a property under the terms and conditions of a tenancy agreement.

Tenure - The type of ownership of a property such as Freehold or Leasehold. Shared Ownership homes are leasehold.

Thirdfort – A UK-based digital platform that provides secure identity verification and anti-money laundering checks for property transactions using biometric and open banking technology. Thirdfort checks will need to be completed on all buyers and any giftors.

V

Valuation - A valuation is the estimated value of a home determined by an inspection of the property and its comparison to recently sold homes in the area. With new build properties, the valuation is reviewed every three months to reflect any changes in the market. If exchange of contract has not taken place, the price of the property could increase/decrease depending on market conditions.

Vendor - The current owner who is selling the property.