AAPR
Average Annual Percentage Rate – A term used to describe the “true rate” of a loan, especially in the US. It considers honeymoon rates, ongoing fees, introductory offers, and discharge fees in addition to the advertised interest rate. It doesn’t include government fees or service fees like redraw and internet usage.

Absolute Title
A title that gives the owner full ownership of a property, free from any claims or encumbrances.
Example: “A buyer with an absolute title doesn’t need to worry about anyone else claiming ownership.”

Abut
When one property shares a common boundary with another.

Acceptance
A formal agreement to the terms of an offer or contract.

Accumulation Phase
The period in superannuation when contributions are made and the fund grows through investment before retirement.

Accrued Interest
Loan interest that has been incurred but not yet paid. It appears as an expense and a current liability on the borrower’s financial records.

Act of God
An unforeseen natural event (e.g. flood, earthquake) that cannot be prevented and may affect contractual obligations.

Actual Cash Value
The depreciated value of an item or property at the time of loss or damage, used in insurance claims.

Adding Value
Improvements or upgrades that increase a property’s market value or income potential.

Affordability
A measure of how easily a person or household can pay for housing costs relative to their income.

Agent
Someone who acts on behalf of another person or organisation, e.g. a real estate agent for a landlord or owner.

Allocated Pension
A type of superannuation income stream where retirees draw a regular income from their accumulated super balance.

Amortisation Period
Also known as the loan term—the agreed length of time a borrower has to repay a loan.

Angel Investors
Individuals who provide capital to startups in exchange for equity, usually at an early stage of development.

Annuity
A financial product that pays out a fixed stream of income, often used during retirement.

APP Number
Contains all purchase loans; requires contacting Macquarie to retrieve data/details.

Application Fees
Fees charged by a lender to set up the loan.

Appraised Value
The estimated value of a property being used as loan security.

Appreciation
An increase in the value of an asset over time due to market conditions or improvements.

Arbitrage
The practice of exploiting price differences in different markets to make a profit.

Arrears
An outstanding or overdue amount.

Assets
Money, property, or goods owned.

Asset Allocation
Dividing investments among different asset classes to balance risk and return.

Asset Class
A group of similar investment types such as equities, fixed income, property, or cash.

Asset Inflation
An increase in the price of assets like property or shares, often beyond their intrinsic value.

Asset Mix
The combination of different asset classes within a portfolio.

Authorised Capital
The maximum value of shares a company is allowed to issue as stated in its constitution.

Average Unimproved Value (AUV)
The average value of land (excluding improvements) over a period, used in calculating land tax.

Bank Deposit
Money placed into a bank account for safekeeping and interest.

Base Rent
The minimum rent a tenant must pay under a lease, excluding additional costs.

Bear Market
A market condition in which prices are falling or expected to fall, typically by 20% or more.

Benchmark
A standard against which performance can be measured.

Blue Chip
Shares in large, established companies known for stability, profitability, and reliability.

Bond
A fixed-income investment where investors lend money to an entity in exchange for periodic interest and repayment.

Boom Phase
A period of strong economic growth and rising asset prices.

Bricks and Mortar
A term referring to physical real estate property.

Bull Market
A market condition where prices are rising or are expected to rise.

Bull Run
A prolonged period of rising prices in the market.

Capital Flight
The large-scale movement of financial assets out of a country due to instability.

Capital Gains
The financial gain when an asset is sold for more than its original price.

Capital Gains Tax
Federal tax on monetary gain made on the sale of an asset (excluding owner-occupied homes).

Capital Growth and Return
The increase in value of an asset over time and the income it generates.

CAT (Client Advice Tool)
A client support tool used in financial services.

Cash Flow
The movement of money in and out of a business or investment.

• Positive Cash Flow: Income exceeds expenses.

• Neutral Cash Flow: Income equals expenses.

• Negative Cash Flow: Expenses exceed income.

Caveat
A notice lodged against a property title to show that someone other than the owner claims a legal interest in it.

Certificate of Title
A legal document that proves ownership of a property and lists any registered encumbrances.

Chattels
Movable personal items not permanently attached to the property, e.g. furniture or appliances.

Churning
Excessive buying and selling of investments to generate commissions, often against the client’s interest.

CIF (Client Information Form)
A document used to collect essential client details for loan or financial applications.

Clear Title
Ownership of property free from any legal disputes or encumbrances.

Commercial Broker
A finance expert who helps businesses secure commercial loans or funding.

Commercial Property Rent
Rental payments made for business-use properties like offices, warehouses, or retail space.

Commission
A fee paid to an agent (e.g. real estate agent) for services rendered, typically as a percentage of the sale.

Comparison Rate
A rate that includes the interest rate plus most fees and charges, giving a clearer picture of the loan’s cost.

Concession
A discount or reduced rate offered under certain conditions, often in government fees or taxes.

Contract of Sale
A legal agreement outlining the terms and conditions of a property transaction between a buyer and a seller.

Conveyance
The legal transfer of property ownership from seller to buyer.

Conveyancing
The process of legally transferring property ownership, including all administrative and legal work involved.

Cover Note
A temporary certificate of insurance provided before a formal policy is issued.

Credit
Borrowed money that must be repaid under agreed terms.

Credit Limit Increase
A raise in the maximum borrowing limit available on a loan or credit account.

Credit Union
A member-owned financial institution offering similar services to a bank.

Creditor
A person or entity to whom money is owed.

Cross-collateralization
Using multiple properties as security for a single loan.

DDR (Direct Debit Request)
An authorisation form allowing automatic withdrawals from a bank account.

Debtor
A person or entity that owes money to another.

Deed
A legal document representing ownership of property.

Default
Failure to meet the legal obligations of a loan, typically missing payments.

Deposit
An upfront payment made when entering into a contract to purchase property, usually 5–20% of the price.

Deposit Bond
A financial guarantee in place of a cash deposit when purchasing property.

Direct Debit
An automatic withdrawal from a bank account to make regular payments.

Disbursements
Out-of-pocket expenses paid during the conveyancing process, e.g. title searches.

Discharge Authority
A form used to initiate the release or finalisation of a loan.

Discharge Fees
Fees charged for closing a loan account.

Discharge of Mortgage
A legal document confirming that a home loan has been fully repaid.

Disposable Income
Income left over after all fixed obligations are paid.

Draw Down
Accessing funds from an approved loan.

Easement
A legal right to use part of someone else’s land for a specific purpose, such as access.

Encumbrance
A legal claim or liability on a property, such as a mortgage or easement.

Equity
The difference between the property’s market value and the outstanding loan balance.

Equity Access
A facility allowing homeowners to access available equity through a line of credit.

Establishment Fees
Fees charged to set up a loan account.

Exit or Early Repayment Fees
Charges for repaying a loan before its agreed term ends.

Extra Repayments
Payments made above the minimum loan requirement, helping reduce loan term and interest.

FEE-HELP
A government loan scheme for eligible domestic fee-paying students to help cover higher education tuition fees. Not subsidised by the government; repayment is required once income exceeds a certain threshold.

First Home Owners Grant (FHOG)
A one-time grant provided by the federal or state governments to eligible first-time home buyers purchasing or building a new home.

Fittings
Items that are fixed to the property and typically included in a property sale, such as carpets, light fixtures, or window coverings.

Fixed Rate
An interest rate that stays the same for a set loan term (typically 1–7 years), offering predictable repayments.

Freehold
Complete ownership of land and property, with no time limit on ownership.

Gazumping
When a seller verbally accepts an offer, but later accepts a higher offer from another buyer before exchanging contracts.

Guarantee
A promise made by a third party to meet the borrower’s loan obligations if the borrower defaults.

Guarantor
A person who agrees to repay a borrower’s loan if they fail to do so.

HECS-HELP
A government loan for eligible students studying in a Commonwealth supported place, to help pay for student contributions.

Home Equity
The current market value of a home minus the outstanding mortgage balance. It increases as the loan is repaid or the home’s value appreciates.

Home Loan
A loan used to purchase property. The property serves as collateral, and the lender holds the title until the loan is repaid.

Instalment
A scheduled periodic payment made to repay a loan, typically monthly or fortnightly.

Interest
The cost of borrowing money, calculated as a percentage of the loan amount.

Interest Only Loan
A loan in which only interest is paid for a set period, with principal repayments beginning later.

Interest Rate
The percentage charged on a loan, representing the cost of borrowing.

Introductory Loan
A home loan with a reduced interest rate for an initial period (e.g. 6–12 months), after which the rate reverts to a standard variable rate.

Investment Property
A property bought with the intention of generating income or capital growth, rather than as a primary residence.

Joint Tenants
A type of property ownership where each party has equal ownership and survivorship rights.

Lease
A legal agreement giving a tenant the right to occupy property for a specified period in return for rent.

Lender’s Mortgage Insurance (LMI)
Insurance that protects the lender if the borrower defaults and the sale of the property doesn’t cover the loan. Required when the LVR is above 80%.

Line of Credit Loan
A flexible loan allowing the borrower to access funds up to an approved limit and repay or redraw as needed.

Loan to Value Ratio (LVR)
The ratio of the loan amount to the appraised value of the property, expressed as a percentage. For example, a $400,000 loan on a $500,000 property equals an 80% LVR.

Lump Sum Repayments
Additional, one-off repayments made toward the loan principal, helping reduce interest and loan duration.

LTO (Land Title Office)
The government department responsible for managing land ownership records, titles, and registrations.

MA (Male Applicant)
Used in application forms to identify the gender of the applicant.

Management Fees
Charges paid to property managers or agents for managing a rental property, typically a percentage of the rent collected.

Managing Agent
A person or company responsible for overseeing the daily operations of a rental property on behalf of the owner.

Marketing Expenses
Costs related to promoting a property for sale or lease, including advertising, professional photography, and signage.

Marketing Feasibility Study
An assessment of whether a property development or investment is likely to succeed based on demand, location, demographics, and competition.

Market Rent
The estimated rental income a property could earn based on current market conditions and comparable properties.

Market Value
The likely selling price of a property in an open and competitive market between a willing buyer and seller.

Material Change of Use
A change in how a property is used, such as converting a residential home into a commercial office, often requiring council approval.

Maturity
The date on which a loan or financial product must be repaid in full.

Maximum Loan Amount
The highest amount a lender will allow a borrower to borrow, based on factors like income, deposit, and property value.

Minimum Loan Amount
The lowest amount a lender is willing to provide for a loan.

Minimum Repayment Required
The smallest amount the borrower must pay on their loan each repayment period to stay in good standing.

Minimum Repayment
See Minimum Repayment Required.

Money Supply
The total volume of money in circulation within an economy, including cash and bank balances.

Mortgage
A loan used to purchase property where the property itself is used as security until the loan is paid off.

Mortgage Broker
A professional who arranges home loans on behalf of borrowers, offering access to multiple lenders.

Mortgage Discharge Fees
Fees charged by a lender for removing the mortgage from the property title once the loan is fully repaid.

Mortgage Duty
A state-based tax (now mostly abolished) that was once levied when registering a mortgage.

Mortgage Offset Account
A transaction account linked to a mortgage that reduces interest by offsetting the loan balance with account funds. For example, a $400,000 loan with $20,000 in offset means interest is only charged on $380,000.

Mortgage Protection Insurance
Insurance covering loan repayments in case of sickness, unemployment, or death.

Mortgage Registration Fee
A government fee for registering the mortgage on the title of a property.

Mortgage Trust
A managed fund where pooled investor money is lent out as mortgages secured against real estate.

Mortgagee
The lender or financial institution providing the home loan.

Mortgagor
The borrower or owner of the property who offers it as security for the mortgage.

Movable Assets
Items not permanently fixed to a property, such as furniture or appliances. Also known as personal property.

Net Income
The total income earned after all expenses, taxes, and deductions have been subtracted.

Net Operating Income (NOI)
The income from a property after operating expenses are deducted but before taxes and financing. For example: $60,000 rental income – $15,000 expenses = $45,000 NOI.

Net Present Value (NPV)
A valuation method to assess the present value of future cash flows from an investment, discounted at a specified rate.

Net Rent
The rental amount paid by a tenant, excluding other costs like rates, insurance, or maintenance.

Net Residential Density
The number of dwellings per hectare, excluding roads, parks, and other non-residential land.

Net Worth (or Net Wealth)
An individual’s or entity’s total assets minus total liabilities. For example: $1M in assets – $600K in debts = $400K net worth.

Negative Equity
When the market value of a property falls below the outstanding loan balance. For example, a $450,000 loan on a $430,000 property.

Negative Gearing
When the costs of owning an investment (like interest and expenses) exceed its income. The loss can be claimed against other income for tax purposes.

Non-Conforming Mortgage
A home loan for borrowers who don’t meet standard lending criteria, such as those with irregular income or poor credit history.

Notice to Complete
A formal notice served by one party in a property transaction requiring the other party to settle by a specified date or face legal consequences.

Novated Lease
A three-way agreement between an employee, employer, and finance company, where the employer makes vehicle lease payments on behalf of the employee, typically via salary sacrifice.

Official Cash Rate (OCR)
The benchmark interest rate set by the Reserve Bank of Australia that influences lending rates across the economy.

Offset Account
A bank account linked to a mortgage that reduces the interest payable. For instance, a $300,000 loan with $30,000 in offset means interest is charged on $270,000.

Ongoing Fees
Regular fees charged by lenders, often monthly or annually, to maintain a loan or banking service.

Open Listing
A non-exclusive listing agreement where multiple real estate agents can market a property and the one who sells it gets the commission.

Open Space
Public or private land reserved for recreation, environmental preservation, or visual appeal, such as parks.

Operating Expenses
Day-to-day expenses required to maintain and manage a property, such as repairs, insurance, and utilities.

Option Agreement
A legal contract granting a party the right—but not the obligation—to buy or sell a property under agreed terms within a specified time.

Ordinary Income
Income earned from regular activities, like wages, business operations, or rent—not including capital gains.

Outstanding Balance
The remaining amount owed on a loan or credit facility.

Outgoings
Expenses payable by the tenant under a lease, such as council rates, building insurance, and maintenance.

Overcapitalise
To spend more on a property than what it’s worth or can return on resale.

Overheads
Fixed costs required to run a business, like rent, administration, or salaries, not directly linked to specific services or products.

Owner Occupied
A property that is lived in by the owner, rather than rented to tenants.

Passed In
When a property at auction does not reach the reserve price and remains unsold.

Pay As You Go (PAYG)
A tax system where employers deduct income tax from employee wages and remit it to the Australian Taxation Office (ATO).

Peer-to-Peer Lending (P2P)
An online platform-based lending system where individuals borrow and lend money directly, bypassing traditional banks.

Personal Loans
Loans provided to individuals for personal use, such as travel, medical bills, or renovations. They are typically unsecured.

Personal Property
Movable items not fixed to land or buildings, such as furniture or vehicles. Contrasts with real property.

Pest Inspection
An assessment to check for the presence of pests (e.g. termites) in a property. Often done before purchase.

Pest Inspection Report
A formal document detailing findings and recommendations from a pest inspection.

Plan Sealing
The council’s confirmation that a subdivision or development plan meets all conditions before registering with the Titles Office.

Population Density
The number of people living per square kilometre in a defined area.

Positive Cashflow
When a property’s rental income exceeds its total expenses. Example: $2,500 income and $2,000 expenses = $500 positive cashflow.

Pre-Purchase Inspection
A comprehensive building inspection carried out before buying a property to assess structural condition and identify issues.

Prequalification
An initial evaluation by a lender estimating how much a borrower might be eligible to borrow, based on basic financial data.

Prime Cost Method
A depreciation method where assets are depreciated at a fixed rate based on their original cost.

Prime Loans
Loans offered to borrowers with good credit history, stable income, and low risk of default, typically with lower interest rates.

Prime and Subprime Markets
The prime market serves low-risk borrowers, while subprime caters to high-risk borrowers with poorer credit profiles.

Prime Rate
The interest rate that banks charge their most creditworthy customers. Often used as a benchmark for other rates.

Principal
The initial loan amount borrowed or the remaining balance on which interest is charged.

Principal Place of Residence (PPR)
The primary home in which an individual resides. Often qualifies for certain tax exemptions.

Private Certifier
An accredited professional who can assess and approve building work for code compliance, offering an alternative to council certification.

Private Treaty Sale
A property sale negotiated privately between buyer and seller, rather than through public auction.

Profit and Loss Statement
A financial report summarising income, expenses, and net profit over a given period. Also known as an income statement.

Profit Margin
A profitability measure calculated as (Net Profit ÷ Revenue) × 100.

Proforma
A forecast or projected financial statement used to estimate future financial performance.

Promissory Note
A written, signed document in which one party promises to pay a specified amount to another by a certain date.

Property Levy
A fee imposed by local councils on property owners to fund infrastructure, services, or special projects.

Prospectus
A document that provides details about an investment offering, including financials, risks, and returns.

Public Housing
Government-owned housing provided to eligible individuals or families with low incomes or special needs.

Purchase Entity
The legal structure under which a property is purchased, such as an individual, trust, or company.

Put Option
A contract giving the holder the right (but not the obligation) to sell an asset at a specified price within a certain time.

Quantity Surveyor
A construction cost professional who can estimate costs, prepare tax depreciation schedules, and manage building contracts.

Real Estate Agent
A licensed professional who facilitates the buying, selling, or leasing of real estate.

Real Property
Land and anything permanently attached to it, such as buildings or fixtures.

Redevelopment Site
A property intended for demolition and new development, often to improve land use or increase density.

Registered Plan
A legal document showing the boundaries and divisions of land, officially recorded with the state titles office.

Relet Prior to Vacancy
Leasing a rental property to a new tenant before the current tenant vacates.

Requisition on Title
Formal queries made by a buyer’s solicitor to the seller, seeking clarification or documentation regarding the property’s title.

Reserve Price
The minimum price a seller is willing to accept at auction. If bids do not reach this price, the property may be passed in.

Residential vs Commercial
Residential properties are used for living purposes (e.g., houses, apartments), while commercial properties are used for business (e.g., offices, shops).

Residential Tenancies Act
Legislation that outlines the legal rights and responsibilities of landlords and tenants in residential rental agreements.

Retail Leases
Commercial leases for properties used to sell goods or services to the public, often governed by specific laws.

Right of First Refusal
A contractual right allowing a party the opportunity to buy a property before the seller offers it to others.

Right of Way
A legal right for someone to pass through another person’s property.

Rooming House
A residential property where multiple unrelated individuals rent individual rooms and share common areas.

Routine Inspection Report
A property manager’s report prepared during regular inspections of a rental property, noting its condition and maintenance needs.

Savings
Money set aside from income for future use, emergencies, or investments.

Shares
Units of ownership in a company that entitle the shareholder to a portion of profits and voting rights.

Smart Investor
A well-informed investor who diversifies their portfolio, researches opportunities, and aligns investments with financial goals.

Structure
The legal and operational setup of an investment or business entity, such as sole trader, company, or trust.

Sunset Clause
A provision in a property contract that sets a deadline by which certain conditions must be met (e.g. project completion). If not met, parties may rescind the agreement.

Sweat Equity
Non-cash contributions such as labour or services provided to increase the value or ownership share in a property or business.

Underwriting
The process by which a financial institution assesses the risk of insuring or lending money and sets the terms accordingly.

Unit Trust
An investment structure where funds are pooled and investors hold units representing a portion of the trust’s assets.

Utilities Bill
A statement outlining charges for essential services such as electricity, water, and gas supplied to a property.

Volatility
A measure of how much the value of an investment fluctuates over time. High volatility implies greater risk.

Weighted Average Lease Expiry (WALE)
The average remaining lease term across a property portfolio, weighted by rental income—used to assess stability of income.

Yield
The income return on an investment, usually expressed as a percentage.
Example: Annual rent of $25,000 on a $500,000 property = 5% yield ((25,000 ÷ 500,000) × 100).