Leasehold.. when did 70+ years left become a problem with getting mortgage?

david29dpo

Can i add, if a may, learn from this. Don't expect any so called professional to guide you when they are after you money. Its a shame but thats how it is these days.

pastmybest

david29dpo wrote: »

Can i add, if a may, learn from this. Don't expect any so called professional to guide you when they are after you money. Its a shame but thats how it is these days.

Does this apply to solicitors as well?

david29dpo

No. They are (should be) professionals.

pastmybest

Richard_Webster wrote: »

There is a difference between mortgageability now and the factor that puts buyers off because they realise they will have to extend the lease at some cost in order to sell.

Lenders vary in what they will accept. Most big lenders used to accept 30 yaers plus length of mortgage - so often 55 years - and a number of them still do. Bristol & West/Bank of Ireland always required 70 years. So it used to be that people could get mortgages on say 65-67 years but a sensible solicitor would warn not to go ahead without a lease extension. Now the change is that the Halifax group (including Bank of Scotland and Birmingham Midshires) has raised the limit to 70 years so more people are going to have difficulty even getting an offer.

Traditionally estate agents haven't really understood or bothered with lease length and it only becomes an issue when the lease is so short as to not be mortgageable - so agents would often simply not even ask the question. They should have done so.

In this situation as OP is a shared freeholder, can he not organise a lease extension with the other co-freeholders and offer this as part of the sales package to anyone interested in buying?

Thank you Richard for your very full and helpful post.

I am now in possession of a 999 year lease which will cost me £600'ish, once my sale goes through. It took a couple of months to get sorted but as many of your posts have said in this position beware as there maybe a difficult freeholder and out of four of us two (excluding me!!) were so awkward and without good reason. That is what took the time, much perseverance and my biting my tongue when they almost refused to agree.

My EA's service has been very poor but my current solicitor has a joy to deal with. So pleasant, speaks in layman language and will be worth my paying his bill!

Again thank you for your help ... I am much obliged.

pastmybest

david29dpo wrote: »

No. They are (should be) professionals.

Yes I know I was joking as I know you are one? Are you not?

david29dpo

No, my parter is.

pastmybest

StiflersMom wrote: »

Plenty of ill-informed fools out there in the market place as both you and the OP have proven

So I am an ill informed fool?

So sorry to have bothered you with my post as it seems to have caused you a degree of concern!!!

timmyt

Fire_Fox wrote: »

IMO it is not the estate agent's job to babysit through the process, as an adult you should have appraised yourself of all the rights, responsibilities and implications of leasehold at the outset. However to get the best chance of securing a sale it might have been sensible if they had checked whether you were aware of the problem. I am rather confused that you have lost TWO buyers due to the short lease and have only now realised it is a problem?? I've checked your earlier threads and you are share of freehold so you just need to rush through a lease extension - everything should be explained on thsi site which I am sure you are familiar with by now.
http://www.lease-advice.org/publications/documents/

OP - you are right, the estate Agent is there to sell a lease, and they know how too well a property with a low lease is a slow sale. They forgot to ask, probably so pleased to get you on the books.

Not there fault it is a low lease duration though, and that is the crucial point.

Your previous lawyer should have pointed this out, as 80 or below is where I would advise a client. Most lenders accept 50-60 years, but most buyers are put off if below 80.

Did your solicitor do a bound property report for you, summarising all the papers. Or did you go cheap with who you employed?

pastmybest

timmyt wrote: »

OP - you are right, the estate Agent is there to sell a lease, and they know how too well a property with a low lease is a slow sale. They forgot to ask, probably so pleased to get you on the books.

Not there fault it is a low lease duration though, and that is the crucial point.

Your previous lawyer should have pointed this out, as 80 or below is where I would advise a client. Most lenders accept 50-60 years, but most buyers are put off if below 80.

Did your solicitor do a bound property report for you, summarising all the papers. Or did you go cheap with who you employed?

Thank you for your help.

I have again checked the paperwork from when I bought and whilst my solicitor did point out lots of information including: difference between freehold and leasehold, the service charge, the management company role, my role as Director of the management company, the rights of each of the four owners to access areas needed for items of maintenance there isn’t much more and no warnings about the length of the lease. When I met the guy he could well have told me but I can’t confirm or deny it. He could of sent am email, or separate letter, which I haven’t filed so it could be my fault for not picking up on it or losing said document. It was main stream solicitor not a cheapo and not online who I would not use.

I also checked the agents details from when I bought and it doesn’t have the tenure just a price. My current agent’s details again quote the price and no tenure on the front but say the words inside that it is a lease and the owners can make the lease as long as they want. Yes true but as I found from start to finish was rather an ordeal and took a couple of months.

I just hope my story will make potential buyers of leasehold realise there are pitfalls and that EAs don't often tell it how it is. Even when owning the freehold through a management company, as Richard Webster often says,
you are so utterly reliant on the goodwill of the other directors/owners to get it through.

timmyt

pastmybest wrote: »

Thank you for your help.

I have again checked the paperwork from when I bought and whilst my solicitor did point out lots of information including: difference between freehold and leasehold, the service charge, the management company role, my role as Director of the management company, the rights of each of the four owners to access areas needed for items of maintenance there isn’t much more and no warnings about the length of the lease. When I met the guy he could well have told me but I can’t confirm or deny it. He could of sent am email, or separate letter, which I haven’t filed so it could be my fault for not picking up on it or losing said document. It was main stream solicitor not a cheapo and not online who I would not use.

I also checked the agents details from when I bought and it doesn’t have the tenure just a price. My current agent’s details again quote the price and no tenure on the front but say the words inside that it is a lease and the owners can make the lease as long as they want. Yes true but as I found from start to finish was rather an ordeal and took a couple of months.

I just hope my story will make potential buyers of leasehold realise there are pitfalls and that EAs don't often tell it how it is. Even when owning the freehold through a management company, as Richard Webster often says,
you are so utterly reliant on the goodwill of the other directors/owners to get it through.

an extension can take many months and can be thousands of £s. I use Nick Plotnek (google him) for advice. You need not wait until it is all extended and registered, as you can start the process (Your lawyer will advise) and then ;assign' the benefit of the claim to the Buyer.

your previous lawyer should have advised you, so you may have a claim (causation may be a factor - i.e would the seller to you have actually agreed to pay for a longer lease, would you have proceeded anyway etc) but again , your lawyer could advise. The lawyer may have a record of his meeting with you on file where he said he told you, so that could defeat a claim though.

Good luck