Property Investment Jargon

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Property Investment Jargon

Property Investment Jargon

No one is born a property investment expert, so why is property investment made more intimidating than it should be with endless acronyms? This blog is a simple guide to debunking some of the jargon used in property investment.

Here are the most commonly used:

BTL = Buy to let

No, BTL is not a confused sandwich but the most commonly used abbreviation in property investment. It is often used in text rather than conversation.  BTL stands for ‘buy to let’ which simply means buying a property with the intention to let it out.

LTV = Loan to Value

Loan to value relates to mortgages. In simple terms it’s the loan amount you take against the purchase price. For example if your property cost £100k and you took out a mortgage for £75k, the loan to value (LTV) would be 75%.

DIP = Decision in principle

This is also related to mortgages. When you initially apply for a mortgage, the mortgage company will carry out a fact find, this is to establish whether they are willing to lend to you. Although the DIP is not a mortgage offer it’s the next best thing as it shows the lender is willing to lend to you based on the information you have provided.

ROI = Return on investment

This is the best way to assess any property investment. Not only is Return on Investment a great way to compare property deals against each other it is also a great way to compare property against other types of investment.

Learn how to work out ROI here.

Learn how to use ROI to compare against other investments here

GSOH = Good sense of humour

Always a bonus when investing in property and trait highly appreciated by our friendly team!

2017-08-02T13:25:04+00:00August 31st, 2012|Blog, Property investment|