London Life - Jargon Buster

Use our Jargon Buster to cut through the complicated language financial services companies sometimes use, and find out what it really means. The list is in alphabetical order so you can scroll down to look up words and their meanings:

Redemption penalties
A financial penalty if you decide to repay your lender within a set time period.
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Remortgage
If you change your mortgage lender, or increase your mortgage with the current lender but keep the same house under mortgage, you have remortgaged.
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Renewable term insurance
Life insurance which pays out if you die during the time you are covered. If you want to, you can renew the cover at the end of the term.
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Repossession
If a borrower doesn't pay back their loan as agreed, the lender can take legal ownership of the borrower's property or belongings and sell them to repay the loan. The proceeds of the sale are not always sufficient to repay the outstanding loan and sales costs, and a debt might remain.
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Retail Price Index (RPI)
RPI is a measure of inflation. It tracks changes in the prices of a basket of goods and services, taking a large sample of retail goods including food, tobacco, household goods, transport fares, motoring costs and clothing. An increase in the index means prices have on average increased. RPI is often used as a basis for wage negotiations.
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Retirement Annuity Contracts (RAC)
These were pension contracts only available to the self employed or those employees that did not have access to an occupational pension scheme prior to 1988 when they were replaced by personal pensions. Retirement annuity contracts built up a known level of income at a selected retirement date for a given amount of premium.
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Repayment Mortgage
With a repayment mortgage you repay part of the money you have borrowed each month together with interest. At the end of the mortgage term you will have repaid the money you borrowed and all the interest.
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Reversionary Bonus
A regular bonus that may be added each year. It is only applicable to conventional with profit products. (Also known as annual bonus).
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