I am about to put an offer on a leasehold property in West Beckton. The property agents assure me that it is the norm for flats in West Beckton to have less than 75 years left on the lease. I am obtaining a mortgage with The Mortgage Works. Is this going to be acceptable if the lease has 70 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 18/9/2020 the requirements read as follows :
Where the unexpired lease term is different to that recorded on the mortgage offer, the following clarifies if we need to be informed:
Second hand property:
- If the unexpired lease term on the offer is 85 years or more - only advise us if the actual lease term is less than 85 years
- if the unexpired lease term on the offer is less than 85 years – advise us if the actual lease term is different than reported
- For equity share applications - advise us if the actual lease term is different than reported on the offer
New build property:
- If the unexpired lease term stated on the offer is 125 years (flat) / 250 years (house) or more - only advise us if the actual lease term is less than 125 years (flat) / 250 years (house)
- For equity share applications - always advise us if the actual lease term is different than reported on the offer
Lease terms such as ground rent and event fees must be reasonable at all times during the term of the lease and adhere to our requirements below. If you’re unsure as to whether the terms of a lease are unreasonable or onerous, please refer the details to us in plain English for Valuer consideration. If the potentially onerous terms are in relation to the ground rent please include the current ground rent figure per annum, how often it will be reviewed and the price structure it will be reviewed against. See the guidance below.
SECOND HAND PROPERTIES
Unacceptable - advise Originations (Will be declined):
- Unexpired lease term less than 70 years
- Less than 30 years remaining at the end of the mortgage term
- Ground Rent greater than 0.5% of the property value
- Ground Rent doubles less than every 20 years (e.g. doubles every 5, 10 or 15 years) - acceptable if doubles every 20 years or more
- Ground Rent is compounded RPI
- Ground Rent review period less than or equal to 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 greater than 0.1% and less than or equal to 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 greater than 5 and less than 10 years
- Event clauses exist for normal use e.g. changing the carpet, installing a TV aerial etc
- Estate Rent Charges greater than £500 p/a (please provide details of what the charges cover)
- Service Charges greater than 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 greater than 85 years
- Ground Rent less than or equal to 0.1% of the property value
- Ground Rent review period greater than or equal to 10 years
- Ground Rent escalation less than or equal to RPI
NEW BUILD PROPERTIES (includes office conversions)
Unacceptable - advise Originations (Will be declined):
- Unexpired lease term less than 125 years on a new build flat or less than 250 years on a new build house
- Starting Ground Rent greater than 0.1% of the property value
- Ground Rent review period less than or equal to 5 years
- Ground Rent doubles less than every 20 years (e.g. doubles every 5, 10 or 15 years) - acceptable if doubles every 20 years or more
- 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 greater than £500 p/a (please provide details of what the charges cover)
- Service Charges greater than 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 greater than or equal to 125 years on a new build flat or greater than or equal to 250 years on a new build house
- Starting Ground Rent less than or equal to 0.1% of the property value
- Ground Rent review period greater than 5 years
- Ground Rent escalation less than or equal to 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
What does a local search reveal regarding the property I am purchasing in West Beckton?
West Beckton conveyancing often starts with the submitting local authority searches directly from your local Authority or via a personal search company for instance PSG The local search is essential in every West Beckton conveyancing purchase; that is if you don’t want any nasty surprises after you move into your new home. The search should provide data on, amongst other things, details on planning applications applicable to the premises (whether granted or refused), building control history, any enforcement action, restrictions on permitted development, nearby road schemes, contaminated land and radon gas; in all a total of 13 subject areas.
I purchased a semi-detached Georgian property in West Beckton. Conveyancing solicitor acted for me and Santander. I happened to do a free search for it on the Land Registry database and I saw a couple of entries: one for freehold, another for leasehold with the exact same address. I thought I was buying a freehold how can I check?
You should read the Freehold register you have again and check the Charges Register as there may be mention of a lease. The best way to be sure that you are also the registered proprietor of the leasehold and freehold title as well is to check (£3). It is not completely unheard of in West Beckton and other areas of the country and poses no real issues for owners other than when they remortgage they have to account for both freehold and leasehold interests when dealing with mortgage companies. You can also question the situation with the conveyancing solicitor who conducted the purchase.
Over the last few months I have been searching for a leasehold apartment up to £305k and found one near me in West Beckton I like with open areas and transport links nearby, the downside is that it only has 61 years on the lease. There is not much else in West Beckton suitable, so just wondered if I would be making a mistake buying a lease with such few years left?
If you require a home loan that many years may be an issue. Discount the offer by the anticipated lease extension will cost if it has not already been discounted. If the current proprietor has owned the property for at least twenty four months you could request that they start the process of the extension and pass it to you. An additional ninety years can be extended on to the existing lease term with a zero ground rent applied. You should consult your conveyancing lawyer regarding this matter.
I need to find a conveyancing solicitor for freehold conveyancing in West Beckton. I've discover a web site which appears to be the ideal offering If it is possible to get all this stuff completed via web that would be preferable. Should I be wary? What are the potential pitfalls?
As usual with these online conveyancers you need to read ALL the small print - did you notice the extra charge for dealing with the mortgage?
Me and myhusband and I are searching for an affordable conveyancing lawyer in West Beckton to buy a house. I I am concerned about by bill escalating out of control and there are various West Beckton conveyancing practices to choose from...how do I know which one is best to select?
A trustworthy personal recommendation from a friend or family member who has used a conveyancing lawyer previously is no doubt a preferable. You are bound to know someone who has used a conveyancing lawyer previously. Do make the most of our tool to compare West Beckton conveyancing quotes