Understanding Your ESIS (European Standardised Information Sheet)

The European Standardised Information Sheet (ESIS) outlines all the associated rates, features and fees related to a specific mortgage contract. The Financial Conduct Authority, one of the bodies regulating UK financial services, requires lenders and brokers to present mortgage product information in a consistent, standardised format so that consumers can easily compare different mortgages.

You may find the explanations below helpful in understanding the ESIS provided for your mortgage contract.

An ESIS, sometimes referred to as a Mortgage Illustration, provides a transparent summary of all key aspects of your mortgage. It helps you understand the true cost of borrowing, the conditions of the loan, and any risks or obligations before you commit.

What the ESIS Includes

The ESIS is structured into standard sections, each designed to clearly explain a different part of your mortgage:

1. Lender Details
Includes the name, address and contact details of the mortgage lender.

2. Main Features of the Loan
This section will describe the main characteristics of the mortgage loan. It should include the value, currency, term, repayment type, nature of the mortgage product, the total amount to be repaid by the borrower, and the maximum loan amount available.

3. Interest Rate and Other Costs
This section will include information regarding interest rates and fees applicable to the mortgage. This includes the Annual Percentage Rate of Charge (APRC), which is used to compare mortgage rates across different lenders, how the APRC has been calculated, the product rate, the nature of the interest rate (e.g. if it is fixed or variable), any follow on rates once the mortgage product expires, mortgage product fees, and mortgage exit fees.

4. Frequency and Number of Payments
How often you will make payments and the total number over the mortgage term.

5. Amount of Each Instalment
Your monthly payment amount, when payments may change, and examples of how payments could increase if interest rates rise significantly.

6. Additional Obligations
Any requirements placed on you by the lender, such as property insurance or other conditions.

7. Early Repayment Charges (ERCs)
This section will give full details of any Early Repayment Charges connected to your mortgage product. It will show the fee applicable and if/how it changes during the product term.

8. Flexible Features
This section explains any optional features of the product available to the borrower to use as they see fit. For example, it may include things like overpayment limits, portability, free legal fee incentives, etc.

9. Borrower Rights
The time you have to review and reflect before committing to the mortgage.

10. Complaints Process
The name and contact details of the lender’s complaints process will be detailed here. It will also show a timescale the lender agrees to manage their complaints within.

To further this, details on how to progress a complaint from the lender to the Financial Ombudsman Service, and relevant contact details will also be included.

11. Consequences of Non‑Compliance
This section will explain the actions the lender will take if the borrower breaches the agreement of the mortgage. This could be due to not insuring the property, letting the property out without permission, or failing to keep up with repayments

12. Additional Information
Standard legal wording, applicable law, the language of the ESIS and confirmation that a full mortgage offer will follow.

13. Supervisory Authority
Details of the regulatory bodies supervising the lender.

Why Reading Your ESIS Matters

Your ESIS gives you a clear and complete picture of your mortgage. It shows the true cost of borrowing, including monthly payments, interest rate, total amount repayable and all associated fees. It also explains when any fixed or discounted period ends and when your loan moves to the lender’s Standard Variable Rate. The document outlines any early repayment charges and when they apply, helping you avoid unexpected costs. Reviewing your ESIS carefully ensures it accurately reflects what you discussed with your adviser or broker and helps prevent errors or surprises later on

Important Note About This Document

Your ESIS is typically generated by your adviser or broker and provided to you during the advice stage.  Small variances may occur due to rounding, but:

✔ Your formal mortgage offer from the lender will contain fully accurate figures.
✔ This offer is the document that forms your binding mortgage contract if you choose to proceed.

For additonal help and guidance, please speak with your mortgage advisor.