I am about to put a bid on a leasehold flat in Plumstead. The selling agents say that it is usual for flats in Plumstead to have less than 75 years remaining. I am expecting a loan with The Mortgage Works. Will the property be mortgageable given that the lease has 72 years unexpired.
Most leasehold conveyancing experts should be able to deal with a lease extension. if you are obtaining 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 15/6/2019 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 advises that missing deeds insurance is necessary on my purchase. What is the level of cover for Plumstead conveyancing?
The appropriate level of missing deeds indemnity insurance depends on your lender. It would differ for example between Birmingham Midshires and Leeds Building Society. Conveyancing lawyers as opposed to borrowers take out such insurances.
We had selected solicitors with offices in Plumstead on the TSB solicitor panel. They have just invoiced me a supplemental sum for the legal aspects of the TSB mortgage. Is this an additional conveyancing fee specified by TSB?
Unfortunately, as long as it is in their Terms and Conditions or Quote then yes your lawyer is entitled to levy a fee for this. The fee is not dictated by TSB but by your Plumstead conveyancing practitioner. Some firms on the TSB panel will quote ’dealing with mortgage’ fee and others do not.
At last I have had an offer on an apartment in Plumstead accepted, but there is a chain. The owners have offered on a property, but it’s not been accepted yet, and are looking at other properties in the pipeline. I have selected a bricks and mortar conveyancing solicitor in Plumstead. What should be my next step? At what stage do I apply for the mortgage with Bank of Ireland?
It is understandable to have concerns where there is a chain as you are unlikely to want to be too out of pocket too early (home loan application is in the region of one thousand pounds, then survey, Plumstead conveyancing search costs, etc). The first course of action is to check that your conveyancer is on the Bank of Ireland approved list. Concerning the subsequent steps this very much depends on the circumstances of your transaction, motivation for this property and on the state of the market. During a buoyant market some home buyers would apply for a home loan with Bank of Ireland and arrange for the valuation and only if it was satisfactory would they ask their conveyancer to proceed with the conveyancing in Plumstead.
four months have gone by following my purchase conveyancing in Plumstead took place. I have checked the Land Registry website which shows that I paid £175,000 when infact I paid £160,000. Why the discrepancy?
The price paid figure is taken from the application to register the purchase. It is the figure included in the Transfer (the legal deed which transfers the asset from one person to the other) and referred to as the 'consideration' or purchase price. You can report an error in the price paid figure using the LR online form. In most cases errors result from typos so at first glance the figure. Do report it so they can double check and advise.
I decided to have a survey completed on a property in Plumstead prior to appointing solicitors. I have been told that there is a flying freehold aspect to the property. My surveyor advised that some lenders tend refuse to grant a mortgage on such a property.
It depends who your proposed lender is. HSBC has different requirements for example to Birmingham Midshires. Should you wish to telephone us we can check with the appropriate mortgage company. If you lender is happy to lend one our lawyers can assist as they are accustomed to dealing with flying freeholds in Plumstead. Conveyancing can be more complicated and therefore you should check with your conveyancing solicitor in Plumstead to see if the conveyancing costs will increase in light of this.
We are 3 weeks into a leasehold purchase having been recommend to a firm by the high street agent to carry out the conveyancing in Plumstead. I am am extremely disappointed with the level of service. Could you you assist me in finding new solicitors?
They would need to be really bad in order to consider changing them. Has your mortgage been sent? In the event that it has you will need to advise them of the replacement conveyancer and ensure the mortgage documents are re-issued. The solicitor ideally should be on the banks panel to avoid supplemental charges and complications. So that should be your starting point. Our search tool should assist you in finding a bank approved conveyancer for your home move in Plumstead
Our mortgage broker has suggested using their solicitor for the conveyancing in Plumstead - Surely it’s advisable to just instruct them?
You need to establish if the estate agent is recommending a property lawyer or introducing to a conveyancing practitioner. There are plenty of Plumstead selling agents who recommend two or three Plumstead conveyancing firms and get nothing from it.
