money selecta knows the finance world is full of terms, phrases, buzz words and jargon. The below terms will help you with terms beginning with the Letter B

On this page we explain,
Bad Credit > Balance Transfer > Bankers Draft > Base Rate > Beneficial Owner > Black Listed > Booking Fee > Bridging Loans > Bubble > Buildings Insurance > Building Report > Building Society > Buy to Let

Bad Credit

This is a term used to describe a low credit score due to a poor credit history. County court judgments, mortgage defaults, loan arrears or other credit debt repayment problems are recorded on a national database and can lead to a poor credit rating. Potential lenders can access your credit history and are able to use it to determine the level of risk they would be taking should they decide to lend you finance. It is up to individual lenders whether the risk is acceptable. There are loan providers online that specialize in lending to people with a poor credit status. If you have a problem credit rating, use our finance tools to search for lenders and save yourself hours surfing online.

Balance Transfer

Balance transfer is often used by many people in order to save money on interest charges. Balance transfer usually refers to credit cards. Balances, arrears or any debt out standing on financial products will result in interest and therefore increased debt. One way to reduce this debt is to transfer the balance to a new lender. The new lender should be offering some grace term where the interest earned is reduced or even temporarily waived. This would mean that any payments made go in full towards paying off the balance of the debt and you would reduce the overall amount the debt would cost you.

Bankers Draft

A banker's draft is a cheque drawn against either a cash deposit or funds taken directly from your own bank account.
A bankers draft is a secure way of receiving funds and they are commonly used for large purchases such as property and cars. Banks will generally charge a fee for issuing a banker's draft.

Base Rate

The Bank of England is the body that sets the Base Rate. The Bank of England's Monetary Policy Committee meets monthly to determine the base rate and it can alter quite regularly. The Bank of England Base Rate is the standard base interest rate used for most UK financial products. Lenders will add their own interest rate on the top of this, which is their charge for lending the finance to their customers.
How the base rate fluctuations effects different types of finance repayments depends on what sort of product individual customers have and if any changes are passed on to their customers.

Beneficial Owner

Beneficial owners are basically the people who have the right to live and use a property as they wish, they may however not actually have full possession of the property. Leaseholders or tenants can be classed as beneficial owners.

Black Listed

Being Black listed is usually a result of a really bad credit history. CCJ's, Defaults, Arrears are stored on national credit databases. If there is a persistent credit arrears problem then the credit record of that person will be black listed. This means that the credit record will automatically show the person to be considered a high risk to any potential lender.
Some lenders will still lend to black listed people but the interest rate charged will be considerably high until their credit status has improved.

Booking Fee

A booking fee is a term to describe a fee which is payable up front, to either source or reserve funds for a purchase.
Some particular mortgage products included Booking fees however you may find that many mortgage lenders waiver their booking fees to attract new customers to their mortgage deals.

Bridging Loans

Bridging loans are short term loans. They are used to raise finance quickly. Bridging loans are often used by property buyers, they are often used to complete a property purchase even though the person buying has not yet sold their current property. Bridging loans can avoid you losing out on a property purchase just because you have not sold your own property at that time. They can help you pay for both properties for a short period of time.
Before taking out a bridging loan you should consider the risks first of taking on further financial burdens.

Bubble

With reference to the housing bubble. At the moment property prices are continuing to rise and investing in property is still a viable option .Buyers should be aware that overstretching themselves financially with large mortgages could easily create big debt problems in the future. Should the Bubble burst and mortgage repayments rise would repayments still be manageable or would you fall into debt.

Buildings Insurance

Buildings insurance is insurance cover that usually covers the property itself, together with any permanent fixtures and fittings against damage. Mortgage providers will insist that the property has buildings insurance cover as part of their mortgage arrangement, this will then cover their investment. The sum insured under a buildings policy must be the full rebuilding cost of the home.
Standard buildings insurance should cover the property against damage caused by fire, storm, flood and subsidence. Some insurers will cover against less common occurrences as well usually for an extra charge.

Building Report

A building report is a survey carried out by a surveyor on behalf of a home buyer. The report checks the property for any defects or damage which may effect the buying of the property.
A building report is a survey that increases the fees involved in property purchasing but it should never be over looked or not performed as it is possible it could save you money in the long run.
A Building Report is suitable for all residential properties and provides a full picture of their construction and condition. It is likely to be needed if their property is, for example, of unusual construction, is dilapidated or has been extensively altered - or where a major conversion or renovation is planned. It can usually be tailored to the client's individual requirements.

Building Society

Building societies were set up with the traditional purpose of lending to individuals who wished to purchase property, hence their name. A building society is a organisation that is owned by its members, it's savers and borrowers, and not by shareholders. In order to be able to compete with other strong lenders the building societies have relaxed the rules over the years.

Buy to Let

Buy to let is a term used to describe the purchasing of property purposely to rent out to tenants. You can invest in property by buying a property that you don't necessarily want to live in yourself and renting it out. This means that you could even have a property portfolio in years to come. Due to the stock markets poor performance over recent years more prosperous consumers are choosing to invest their capital in the housing market. Lenders will require that a particular product (Buy to Let) is taken if property is being purchased to then let out to tenants. Buy to Let mortgages often come with different interest rates and conditions.