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Lease extension at completion - Advice needed
oli_ro
Posts: 142 Forumite
[I have also posted in the mortgage section, but realised that this is a better place and don't know how to move/copy/delete the thread]
I would appreciate it if someone can help me by clarify a few things. I am not asking for legal help as I have a solicitor, but I want to understand the process and the alternatives a bit better.
My situation: buying a leasehold flat where the freehold belongs to residents of the building in equal share. Most of the flats had their lease extended to 999 years, and my understanding that in such case extension is a formality.
The current lease on the flat is low (< 60 years). My understanding that there are 4 possible ways forward in such cases:
1. Buy with the current lease and extend after.
2. Ask the current owner to serve notice of intention to extend the lease and transfer that in my name to work around the 2 years constraint
3. “Lease extension on completion” A new longer lease is being arranged and this will be transferred in my name at completion.
4. Current owner extend the lease before exchange and all the contracts are done with the longer lease
The seller is proposing alternative 3. This is discussed at the moment between solicitors and will be obviously checked with the bank by my solicitor.
I am told this should be ok with the lender(Nationwide) as before the transaction, the newer lease comes into effect as per the contract drawn.
Furthermore, Nationwide’s tenure criteria states that: “Where a new longer lease or lease extension is to be purchased the application will be processed using the details of the new/extended lease.”.
Is my understanding correct ?
Is it likely to work ?
Is this procedure something that happens regularly ? I am told this is a well-known and used conveyancing process.
Also, wondering, roughly, how much such a process takes ? I am planning to move in before Christmas, is that naive ?
I would appreciate it if someone can help me by clarify a few things. I am not asking for legal help as I have a solicitor, but I want to understand the process and the alternatives a bit better.
My situation: buying a leasehold flat where the freehold belongs to residents of the building in equal share. Most of the flats had their lease extended to 999 years, and my understanding that in such case extension is a formality.
The current lease on the flat is low (< 60 years). My understanding that there are 4 possible ways forward in such cases:
1. Buy with the current lease and extend after.
2. Ask the current owner to serve notice of intention to extend the lease and transfer that in my name to work around the 2 years constraint
3. “Lease extension on completion” A new longer lease is being arranged and this will be transferred in my name at completion.
4. Current owner extend the lease before exchange and all the contracts are done with the longer lease
The seller is proposing alternative 3. This is discussed at the moment between solicitors and will be obviously checked with the bank by my solicitor.
I am told this should be ok with the lender(Nationwide) as before the transaction, the newer lease comes into effect as per the contract drawn.
Furthermore, Nationwide’s tenure criteria states that: “Where a new longer lease or lease extension is to be purchased the application will be processed using the details of the new/extended lease.”.
Is my understanding correct ?
Is it likely to work ?
Is this procedure something that happens regularly ? I am told this is a well-known and used conveyancing process.
Also, wondering, roughly, how much such a process takes ? I am planning to move in before Christmas, is that naive ?
0
Comments
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If you are curious how this adventure ended search a duplicate thread I posted, called: "Lease extension at sale time" in Mortgages & Endowments thread.0
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