Buying your first home means learning a whole new language, usually while everyone around you (the estate agent, the mortgage broker, your solicitor) speaks it fluently and forgets that you don’t. Nodding along when someone says “we’re just waiting on searches” is practically a first-time buyer rite of passage.
Whether you’re just starting to browse or you’re mid-way through your first purchase, this glossary is your go-to guide. Keep it handy, share it with anyone buying with you, and come back to it whenever the jargon gets confusing.
Making an offer: the early stages of buying your first home
What is an Agreement in Principle (AIP)?
An Agreement in Principle (AIP) is a statement from a mortgage lender saying they would likely lend you a certain amount, based on basic checks. It’s sometimes called a Decision in Principle (DIP) or Mortgage in Principle. An AIP is useful for showing estate agents you’re a serious buyer but it is not a mortgage offer, and it isn’t guaranteed.
| Agreement in Principle | Mortgage Offer | |
|---|---|---|
| What it is | An indication the lender may lend | A formal, binding commitment to lend |
| Based on | Basic checks and your declared income | Full application, credit checks and a valuation |
| Property Specific? | No | Yes — tied to the property you’re buying |
| Needed to exchange? | No | Yes — your solicitor must have this before exchange |
What does Sold STC or “under offer” mean?
Sold STC (Subject to Contract) and “under offer” both mean the seller has accepted an offer, but contracts haven’t yet been exchanged. Nothing is legally binding at this stage for either side. Estate agents vary in exactly how they use the two terms.
What is a memorandum of sale?
A memorandum of sale is the document the estate agent circulates once an offer is accepted, confirming the agreed price and the details of everyone involved, including both sets of solicitors. It starts the legal process but it doesn’t commit anyone to anything yet.
What is gazumping?
Gazumping is when a seller accepts your offer, then accepts a higher offer from someone else before contracts are exchanged. It’s frustrating but legal in England and Wales. Gazumping is one of several reasons why moving efficiently towards exchange protects you as a buyer.
What is a property chain?
A property chain is the line of linked transactions your purchase may sit in: you’re buying from someone who is buying from someone else, and so on. Every link must be ready before anyone can move. Chain-free means there’s no onward chain on the seller’s side, often faster, which is why listings advertise it. First-time buyers are chain-free themselves, which makes them attractive buyers.
The legal process: what your conveyancing solicitor is doing
What is conveyancing?
Conveyancing is the legal work of transferring a property from one owner to another: checking the title, running searches, handling contracts and moving the money safely. The person doing it for you is your conveyancer or conveyancing solicitor.
What are property searches?
Property searches are checks your solicitor runs with the local authority and other bodies before you exchange contracts. The three main types are:
- Local authority search: reveals planning history and land charges affecting the property
- Environmental search: flags flood risk and ground contamination
- Drainage and water search: confirms how the property connects to public sewers and water supply.
Searches exist to make sure there are no nasty surprises attached to the property. They’re also one of the most common things a purchase waits on so when your solicitor says “we’re waiting on searches,” this is what’s happening.
What are disbursements in conveyancing?
Disbursements are costs your solicitor pays out on your behalf as part of the transaction, such as search fees and Land Registry fees. They appear on your conveyancing quote separately from the legal fee itself.
What does “source of funds” mean?
Source of funds refers to the checks your solicitor is legally required to run on where your deposit money came from such as bank statements, savings history, and evidence for any gifts or lump sums. It can feel intrusive, but it’s an anti-money-laundering requirement that applies to every buyer at every firm. Responding quickly to source of funds requests is one of the biggest things a first-time buyer can do to keep their purchase on track.
What is a gifted deposit?
A gifted deposit is money towards your deposit given (not lent) by family. It’s completely normal, but it comes with paperwork: the giver signs a letter confirming it’s a genuine gift, and they’ll be asked for ID and proof of where the money came from too. Tell your solicitor about any gifted deposit on day one; late-declared gifts are a classic cause of delays.
What is title in property law?
Title is the legal record of who owns a property and any rights or restrictions attached to it. Checking the title is a core part of your solicitor’s job, it’s how we make sure the seller actually owns what they’re selling, and that nothing attached to the property will cause you problems later.
Freehold, leasehold and what you’re actually buying
What is the difference between freehold and leasehold?
Freehold means you own the property and the land it stands on outright and indefinitely. Leasehold means you own the property for a fixed period under a lease, while a freeholder owns the building or land, most flats in England and Wales are leasehold.
| Freehold | Leasehold | |
|---|---|---|
| What you own | The property and the land outright | The property for a fixed period; a freeholder owns the building/land |
| Typical term | Indefinite | 99 to 125 years (some newer leases run to 999 years) |
| Common for | Houses | Flats and apartments |
| Watch out for | Service charges; short leases can affect mortgages and resale value |
If you’re buying a flat as a first-time buyer, you’re almost certainly buying leasehold. Your solicitor will review the lease and explain exactly what it commits you to before you sign anything.
What is a service charge?
A service charge is a regular payment (usually monthly or annual) on leasehold properties, covering the upkeep of communal areas, buildings insurance and shared facilities. Service charges vary considerably between properties, so ask for the most recent confirmed figure before committing as it directly affects your monthly outgoings.
What is the TA10 fixtures and fittings form?
The TA10 is a form the seller completes listing exactly what’s included in the sale: curtains, light fittings, the shed, sometimes the white goods. Read it carefully before exchange. “But we thought the wardrobes were staying” is a conversation nobody enjoys on moving day.
Is the lender’s valuation the same as a survey?
No. This catches many first-time buyers out. A survey is an inspection of the property’s condition that you arrange for your own peace of mind, ranging from a basic condition report to a full structural survey. The lender’s valuation only checks that the property is worth what they’re lending against it. A valuation is not a survey, and it won’t spot the damp.
Exchange and completion: the two biggest days of your purchase
What happens at exchange of contracts?
Exchange of contracts is the point at which a property sale becomes legally binding. Signed contracts are formally exchanged between solicitors, your deposit is paid, and a completion date is fixed in the contract. Neither party can pull out after exchange without significant financial penalty.
What happens on completion day?
Completion day is when the remaining money is transferred, ownership legally passes to you, and you collect your keys. Keys usually come early afternoon rather than first thing as the funds have to travel between solicitors’ accounts before they can be released.
What is Stamp Duty Land Tax (SDLT)?
Stamp Duty Land Tax (SDLT) is the tax paid on property purchases in England and Northern Ireland. First-time buyers may qualify for first-time buyer relief, which reduces or removes the SDLT payable depending on the purchase price and the thresholds in force at the time. Your solicitor calculates it, collects it and pays it to HMRC for you at completion.
What is the Land Registry?
HM Land Registry is the government body that records who owns property in England and Wales. After completion, your solicitor registers you as the new owner. This happens behind the scenes in the weeks after you move in so if things go quiet after completion, that’s normal, not forgotten.
Frequently Asked Questions
No, that’s what your conveyancer is for. But knowing the language makes every email and phone call make sense, and makes the whole journey feel less like it’s happening to you.
Mixing up the Agreement in Principle with a mortgage offer. The AIP is an indication; the offer is the commitment. Plenty of buyers believe they “have a mortgage” when they only have an AIP. Your solicitor can’t exchange contracts until the formal mortgage offer is in.
It varies with the chain, the property type and how quickly searches come back but being chain-free works in a first-time buyer’s favour, and responding promptly to ID, source of funds and enquiry requests is the single biggest thing you can control.
First-Time Buyer
If any of these terms have raised questions about your own purchase, our team at PLS is here to help. We guide first-time buyers through this journey every day, in plain English at every stage; it’s how PLS won Best Law Firm for Conveyancing at the First Time Buyer Readers Awards.
Get a quote today or contact us for a no-obligation conversation about your next steps.
