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Payment Break: this is an option on some flexible mortgages that allows the borrower to take a break in making mortgage payments for a specified period. This is normally up to 6 months.

Penalties: these are the costs that can be incurred if the borrower wishes to repay a loan early (i.e. to facilitate a change of lender).

Peppercorn Rent: a term used to denote a ground rent of a trivial amount.

Preliminary Enquiries: a set of questions raised by the purchaser’s solicitor and sent to the vendor via his solicitor, prior to exchange of contracts. They ask for clarification of specific points about the property that is being sold and the present vendor’s ownership of it.

Premium: this is the cost of an insurance policy, normally paid monthly.

Premium Lease: this is a special type of lease, in which a lump sum is paid at the start of the period, instead of a monthly rental.

Principal: this is the original, total sum of the loan which is used to calculate interest.

Private Treaty (For Sale by Private Treaty): the sale of property by private treaty is the method employed by most estate agents, preparing descriptive details of the property and quoting a definitive asking price. Details are circulated – post email, website local paper etc: potential buyers may view the property and either agree to buy at the asking price or submit an offer to purchase. Agreement to buy at this stage (for England and Wales) is subject to formal contracts being prepared between the vendor and the purchaser and those contracts being signed and exchanged between the two parties.

Probate: the official process of proving a will is valid. In many cases part of the estate will involve a property, which might need to be valued for Inheritance Tax purposes. A probate valuation is generally a negotiated value with the district valuer representing the Inland Revenue. A sale cannot proceed to exchange of contracts until probate has been granted.

Public Liability Insurance: this is an insurance policy, taken out by the owner, which covers them in case of injury or death to anyone on or within the perimeter of a property.

Purchaser: this is the person or legal entity who is buying a property from a seller.