Doubling ground rent...

handsondec2011

Help!

I am in the process of purchasing a leasehold flat. My lender doesn't like the doubling ground rent per 25 years.

Is there any way around it?

csgohan4

A broker may know which lender to approach, but doubling ground rent generally are not a good deal for you either.

Makes it more difficult to sell as well.

I would be looking elsewhere If I were you

quotememiserable

Every 25 years isn't so bad. What is it now and when's the next increase? Is it factored into the purchase price - you should expect to pay less for it than for a comparable flat without a doubling lease.

handsondec2011

So its worked out like this...

For the first 25 years £150
For the next 25 years £300
For the next 25 years £600
For the next 25 years £1200
For the remainder of the term £2400

handsondec2011

So its worked out like this...

For the first 25 years £150
For the next 25 years £300
For the next 25 years £600
For the next 25 years £1200
For the remainder of the term £2400

bouicca21

My arithmetic says doubling from a base of £150 means it reaches £1,200 after 75 years rather than £2,400.


Where is it? For the potential problems of a lease with a ground rent of over £250 outside London or £1,000 in London, see:
https://forums.moneysavingexpert.com/discussion/5929681/purchasing-a-flat-with-an-ast

handsondec2011

Thanks, its West Sussex.

I'm reading whats on the lease copy.

davidmcn

handsondec2011 wrote: »

Help!

I am in the process of purchasing a leasehold flat. My lender doesn't like the doubling ground rent per 25 years.

Is there any way around it?

If your lender's policy is against it then your only option is to find another lender. Bear in mind you'll have the same issue when you sell or remortgage.

anselld

handsondec2011 wrote: »

Help!

I am in the process of purchasing a leasehold flat. My lender doesn't like the doubling ground rent per 25 years.

Is there any way around it?

It equates to a year-on-year inflation rate of 2.8%, not exactly arduous.

However, you may need to find another lender which understands this.

Tom99

[FONT=Verdana, sans-serif]£150pa doubling every 25yrs does not sound too bad, it could be a lot worse.[/FONT]
[FONT=Verdana, sans-serif]I am sure if you shop around you will find a mortgage co.[/FONT]
[FONT=Verdana, sans-serif]Once that is sorted you have at least 3 options:[/FONT]

[FONT=Verdana, sans-serif]1 If the vendor has owned for at least 2 yrs you can buy out the ground rent now. Vendor serves Section 42 notice after exchange and assigns the notice to you.[/FONT]
[FONT=Verdana, sans-serif]2 You can wait 2 yrs and serve your own notice.[/FONT]
[FONT=Verdana, sans-serif]3 Since the lease seems of reasonable length, there is no immediate need to extend the lease. Currently proposals are being worked on to make the lease extension process simpler and maybe cheaper for leaseholders. So you could just wait a few years and see what comes of these changes.[/FONT]

theartfullodger

handsondec2011 wrote: »

Help!

I am in the process of purchasing a leasehold flat. My lender doesn't like the doubling ground rent per 25 years.

Is there any way around it?

Yes, buy freehold elsewhere.