What is the difference between a fixed-rate and a variable-rate mortgage?

A fixed-rate mortgage locks your interest rate for a set period, usually two to five years, meaning your monthly payments stay the same regardless of changes to the Bank of England base rate. A variable-rate mortgage, which includes tracker and Standard Variable Rate (SVR) products, means your payments can go up or down as interest rates change. Fixed rates offer payment certainty, while variable rates may start lower but carry the risk of increasing over time.

What does LTV mean and why does it matter for my mortgage?

LTV stands for Loan-to-Value ratio, which is the percentage of the property's value that you borrow as a mortgage. For example, if you buy a £200,000 property with a £20,000 deposit, your LTV is 90%. LTV matters because it directly affects the interest rates available to you — lower LTV ratios (meaning larger deposits) generally unlock better rates and more favourable mortgage terms from lenders.

What is an Agreement in Principle and how is it different from a full mortgage offer?

An Agreement in Principle (AIP), also called a Decision in Principle (DIP) or mortgage promise, is a conditional statement from a lender indicating how much they would be willing to lend you based on basic financial checks. It is not a guarantee of a mortgage. A full mortgage offer comes after a complete application, including a property valuation, detailed income verification, and thorough credit checks. The AIP helps you understand your budget and shows sellers you are a credible buyer.

What are some mortgage and property terms unique to Scotland?

Scotland has several property terms that differ from the rest of the UK. LBTT (Land and Buildings Transaction Tax) is Scotland's equivalent of Stamp Duty in England. Missives are the formal exchange of legal letters between solicitors that create a binding contract of sale. A Home Report is a mandatory document pack provided by the seller that includes a property survey, energy report, and questionnaire. Standard Security is the Scottish term for a mortgage charge registered against a property, and ADS (Additional Dwelling Supplement) is an extra LBTT charge for buyers purchasing a second property.

Which mortgage terms do first-time buyers find most confusing?

First-time buyers commonly find terms like LTV (Loan-to-Value), SVR (Standard Variable Rate), APR (Annual Percentage Rate), and capital repayment versus interest-only confusing. In Scotland specifically, terms such as missives, noting interest, closing dates, and offers over can be particularly unfamiliar. Understanding these terms before you begin your property search helps you make more informed decisions and communicate more effectively with your solicitor and mortgage adviser.