About to place an offer on a leasehold apartment in Earls Court. The property agents tell me that it is standard for flats in Earls Court to have less than 75 years left on the lease. I am taking out a mortgage with The Mortgage Works. Will the property be mortgageable given that the lease has Seventy One years unexpired.
Most leasehold conveyancing experts should be able to deal with a lease extension. if you are securing a mortgage then your lender may insist that the lease be extended before competition. The Mortgage Works have specific requirements as set out in the UK Finance Lenders’ Handbook in relation to minimum unexpired lease terms. As of 20/7/2019 the requirements read as follows :
Ground Rents and event fees must be reasonable at all times during the term of the lease. If you’re unsure as to whether the terms of a lease are unreasonable or onerous, please refer the details to us for Valuer consideration. See the guidance below.
SECOND HAND PROPERTIES
Unacceptable - advise Originations (Will be declined):
- Unexpired lease term <70 years
- Ground Rent >0.5% of the property value
- Ground Rent doubles <every 20 years (e.g. doubles every 5, 10 or 15 years)
- Ground Rent is compounded RPI
- Ground Rent review period ≤5 years
Refer to Originations (Valuer will consider any impact on valuation figure and marketability):
- Unexpired lease term is 70 to 85 years
- Ground Rent >0.1% and ≤0.5% of the property value
- Ground Rent escalation is linked to any indices greater than RPI
- Ground Rent escalation is linked to the value of the building*
- Ground Rent review period is >5 and <10 years
- Event clauses exist for normal use e.g. changing the carpet, installing a TV aerial etc
- Estate Rent Charges >£500 p/a (please provide details of what the charges cover)
- Service Charges >0.5% of property value p/a (please provide details of what the charges cover)
- Anything that appears onerous, unusual or out of the ordinary
Acceptable (no requirement to advise Originations):
- Unexpired lease term >85 years
- Ground Rent ≤0.1% of the property value
- Ground Rent review period ≥10 years
- Ground Rent escalation ≤RPI
NEW BUILD PROPERTIES (includes office conversions)
Unacceptable - advise Originations (Will be declined):
- Unexpired lease term <125 years on a new build flat or <250 years on a new build house
- Starting Ground Rent >0.1% of the property value
- Ground Rent review period ≤ 5 years
- Ground Rent doubles < every 20 years (e.g. doubles every 5, 10 or 15 years)
- Ground Rent is compounded RPI
Refer to Originations (Valuer will consider any impact on valuation figure and marketability):
- Ground Rent is linked to any indices greater than RPI
- Ground Rent is linked to the value of the building*
- Event clauses exist for normal use e.g. changing the carpet, installing a TV aerial etc
- Estate Rent Charges >£500 p/a (please provide details of what the charges cover)
- Service Charges >0.5% of property value p/a (please provide details of what the charges cover)
- Anything else appears onerous, unusual or out of the ordinary
Acceptable (no requirement to advise Originations):
- Unexpired lease term ≥125 years on a new build flat or ≥250 years on a new build house
- Starting Ground Rent ≤0.1% of the property value
- Ground Rent review period >5 years
- Ground Rent escalation ≤RPI
* Where the Ground Rent escalation is linked to the value of the building, please provide the following:
- How is the value of the block/unit currently calculated and if the assessment relates to the block(s), how is the Ground Rent calculated/apportioned per property?
- The current valuation and Ground Rent for each unit
- What is the mechanism for future valuations of the block and how is the Ground Rent calculated/apportioned?
- What is the right of appeal? And is this a documented process within the lease?
- Who bears the cost of the valuation (and appeal) process?
- Confirmation the review period is not less than twenty years
Please help - my lawyer says that restrictive coveneant insurance is needed on my purchase. What is the typical level of cover needed for conveyancing in Earls Court?
The right level of restrictive coveneant indemnity insurance depends on who your lender is. It would differ for example between Lloyds TSB Bank and Chelsea Building Society. Conveyancing lawyers as opposed to borrowers take out such policies.
When it comes to lenders such as Bank of Ireland, do Earls Court property lawyers face an annual charge to be on the conveyancing panel?
We are not aware of any mortgage company fees to register on their list of approved firms, although some do levy an administration fee to deal with the processing of the conveyancing panel application.
Does a directory service exist listing Bank of Ireland panel conveyancers in Earls Court on the Council of Mortgage Lender’s Website?
No. There is no such tool on the Council of Mortgage Lenders or Building Society Association websites. Very few lenders make their panel listings viewable online. If you are looking for a Earls Court property lawyer on the Bank of Ireland please use our facility.
I used Arc property Solicitors several years ago for my conveyancing in Earls Court. I now require my file but cannot find the solicitor. What do I do?
You should contact the Solicitors Regulatory Authority (SRA) to assist in tracing your conveyancing files. They can be contacted on please contact on 0870 606 2555. Alternatively, you should use their online form to make an enquiry. You will need to provide the SRA with as much information as possible to assist their search, including the name and address in Earls Court of the conveyancing firm of solicitors you previously used, the name of conveyancing solicitor with whom you had dealings, and the date on which you last had dealings with the firm.
Due to the encouragement of my in-laws I had a survey completed on a property in Earls Court ahead of retaining conveyancers. I have been advised that there is a flying freehold aspect to the house. The surveyor advised that some lenders may not grant a mortgage on this type of property.
It depends who your proposed lender is. HSBC has different instructions for example to Birmingham Midshires. Should you wish to call us we can investigate further with the appropriate lender. If you lender is happy to lend one our lawyers can assist as they are used to dealing with flying freeholds in Earls Court. Conveyancing will be smoother if you use a solicitor in Earls Court especially if they are acquainted with such properties in Earls Court.
Should I be concerned by 3rd parties that I am dealing with are encouraging me to use an internet conveyancing firm as opposed to a High Street Earls Court conveyancing company?
As with lots of service providers, often referrals from connections can be extremely useful or valuable. Yet there are numerous players in a conveyancing matter; estate agents, mortgage brokers and mortgage companies may recommend conveyancers to use. On occasion the solicitors might be known to one of the organisations as being good in their field, but occasionally there may be a commercial relationship behind the recommendation. You are at liberty to choose your preferred conveyancer. However, bear in mind that many mortgage providers operate an approved list of lawyers you have to use for the lender aspect of your house move.
I am thinking of appointing a conveyancing lawyer in Earls Court for my house move. Can I review a solicitor's record with the legal regulator?
You may search for documented Solicitor Regulator Association (SRA) decisions arising from inquisitions commenced on or after Jan 2008. Go to Check a solicitor's record. To find details about the period before 1 January 2008, or to check a firm's record, telephone 0870 606 2555, 08.00 - 18.00 Monday, Wednesday, Thursday, Friday and 09.30 - 18.00 Tuesday. For non-uk callers, call +44 (0)121 329 6800. The SRA could monitor telephone calls for training purposes.
