1. AAPR Average Annualised Percentage Rate
  2. Additional repayment– Extra funds paid into the loan in addition to the minimum monthly payments.
  3. Agent – Real Estate Agent
  4. Arrears – Overdue amount on your account which is yet to be paid
  5. Assets – Goods or property owned by you
  6. Amortisation Period – The period of time a loan is calculated over (and repaid).
  7. Commission – The money we pay to a broker, or a financial adviser who trades products on behalf of a company (like insurance).
  8. Charge – Any right established over the borrower’s property in lieu of the obligation or amount to be recovered.
  9. Contract of Sale – A written agreement which defines the terms and conditions of sale
  10. Deed – A document in writing which is signed, sealed and delivered by the parties to prove and testify the agreement of the parties to the things contained in the deed.
  11. DSR – Debt Service Ratio
  12. EquityThe amount of something we own, typically in a property or business. If we sold the asset and paid back any money we owed on it, our equity would be what’s left. For example, if we have a house worth $250,000 and a $200,000 mortgage, our equity in the house is $50,000.
  13. GuarantorA person/s who agree to be responsible for the payment of another person’s debts.
  14. LiabilityA debt which one is liable for; being responsible only to a limited amount.
  15. LoanAn advance of funds from a lender to a borrower on the agreement that the borrower pays interest on the loan, plus paying back the initial amount of the loan at or over an agreed time.
  16. Lump sum – A large, one-time payment of money to pay off a debt or invest in a fund. Typically these will save us significant amounts of interest for debt or help us leap forward with investing.
  17. LVR(Loan to Valuation Ratio) the ratio of the amount lent, to the valuation of the property.
  18. MaturityThe date a debt or investment must be paid in full.
  19. MortgageA form of security for a loan usually taken over real estate. The Lender, the mortgagee has the right to take (repossess) the real estate if the mortgagor fails to repay the loan.
  20. Net Income – The income received by an individual AFTER TAX has been taken out.
  21. Net Profit – The profit remaining in a business after all expenses have been taken out, but BEFORE TAX.
  22. OCR Official Cash Rate – the interest rate set by the Reserve Bank to influence the price of borrowing money in New Zealand. It is also a tool that influences the amount of economic activity and inflation. Changes in the OCR can affect how much interest we pay on our mortgage and how much we earn on our savings.
  23. PIE A Portfolio Investment Entity is a type of savings or investment fund that has special tax advantages. KiwiSaver default funds are examples. When we save through or invest in a PIE, we pay either 0%, 10.5%, 17.5% or 28% tax on our share of the returns, depending on our income.
  24. Principal– The capital sum borrowed on which interest is paid during the term of the loan.
  25. Refinancing – To replace or extend an existing loan with funds from the same institution or another.
  26. Term– The length of a home loan or a specific portion within that loan. Third Party Security provided for a mortgage by a third party (someone different from actual borrowers) who is legally different from the borrower or debtor.
  27. Valuation– A report as required by the Lender, detailing a professional opinion of a property’s value.



  1. ActuarySpecialist in risk analysis in relation to insurance. Their job is to analyse risks and to calculate pricing based on that analysis.
  2. Acceptance TermsThe terms by which an insurer or lender agrees to accept an application for insurance or home lending.
  3. Advisor An intermediary sales person who is independent of the insurance, home lending or kiwi saver providers whose products they sell.
  4. Annual Premium Income (API) The annual equivalent of the premium payable by the customer.
  5. Claim The process by which a demand is made against the proceeds of an insurance policy.
  6. Claims Ratio The ratio of claims costs to premiums received for product providers.
  7. Commission The payment made by product providers to agents and brokers for the sale of their products.
  8. Declined When an insurer or lender refuses to accept an application for its products or where a claim against an insurance policy is turned down by the insurer.
  9. Deferred When an insurer delays the acceptance of an application for insurance until a current risk reduces to an acceptable level or an unknown risk is able to be quantified.
  10. Endorsement A special condition that applies to an insurance policy for example an endorsement may state that drivers younger than a nominated age are not covered under the policy or it may state that a particular medical condition is not covered e.g. asthma.
  11. Exclusion Anything that is not covered by the policy. There may be blanket exclusions that apply to all customers and specific exclusions that apply only to specific customers.
  12. Expiry Date The date that a benefit, policy or contract reaches its end date.
  13. Free Look Period By law there is a 15 day ‘free look’ period for insurance policies whereby the client can cancel and receive all premiums back. Partners Life has a 30 day free look period from the date of issue.
  14. Group Insurance A single insurance policy which insures a group of individuals. Commonly provided for employees of the same company. A master policy is issued to the company rather than individual policies being issued to the employees.
  15. Insured A person or organisation covered by an insurance policy.
  16. LapseA policy of insurance lapses when premiums remain unpaid for a predetermined period. A lapsed policy provides no coverage during the period it remains lapsed.
  17. Medsafe – Government body responsible for establishing the safety and efficacy of medications. Only medsafe approved treatments are able to be prescribed in NZ.
  18. Policyholder – The individual or organisation to whom the proceeds of the policy will be paid and whom has the right to make changes to the policy details subject to the insurance company’s normal processes.
  19. Policy Schedule – Included as part of the policy document, the schedule outlines the specific details relating to the insured e.g. name, address, types and amounts of cover, premium payable etc…
  20. Pre-existing condition – A physical defect, medical condition or disease that an applicant has suffered from or is suffering from at the date of an application for life or health insurance benefits.
  21. Premium – The total amount payable to an insurer for an insurance policy.
  22. Sum Insured or ‘Cover’– The amount of protection provided by an insurance policy .
  23. Underwriting – The assessment of the risk posed to an insurer or lender by the individual demographics of the applicant and/or the asset to be insured.
  24. WNC – Will Not Complete. Where an application for a contract is cancelled or withdrawn before the contract is completed and issued.