Mortgages and short leases

Cjramona

My fixed rate has ended and I now have huge repayments and can't remortgage as my lease has dropped below 60 years.

I need to renew the lease asap to either remortgage or sell - does anyone have any experience of this process? Is it REALLY expensive??

Thanks

Dan_Collins_2

Hi

It can be expensive, depends on the lease, how long you lived there and the freeholder! You need to talk to your solicitor, maybe the one you used when buying and you will also need to talk to the freeholder.

Also how long is your mortgage, some lenders want 30 years at the end of the term, I did a 70 year lease via Nationwide earlier this year. Also depends on what type of property it is an what part of the country.

Mr_helpful

There are lenders who will do this but it would be a good idea to extend the lease as you will increase the value of the property

Cjramona

Thanks.

I've got 58 years left and have contacted the Freeholder's solicitor (freeholder lives abroad) and need to send them a cheque for £1500 to cover their fees and the survey. I've lived in the property for 9 years and have just been very naive not thinking about this at all!

cattie

Get free impartial advice re extending leases here. It's a government funded agency. http://www.lease-advice.org/newintro.htm

EdInvestor

Cjramona wrote: »

I've got 58 years left and have contacted the Freeholder's solicitor (freeholder lives abroad) and need to send them a cheque for £1500 to cover their fees and the survey. I've lived in the property for 9 years and have just been very naive not thinking about this at all!

This is the procedure:

You write to the freeholder stating that you wish to extend the lease (you are entitled to do this after living at the flat for 2 years) and asking what terms he is prepared to offer.It is then up to the freeholder to appoint a surveyor to work out what his price is (you don't pay anything at this stage).

You may wish to hire your own surveyor to work out the cost (you can also check around various estate agents in the area, ask neighbours, other leaseholders in the building etc). Almost always there is a negotiation involved on number of years of new lease, new ground rent and price.

Only when you have agreed a deal should you pay anything to the freeholder's solicitor: this will be for the deed of variation of the lease.You are required to pay his legal costs as well as the price of the extension.

When you've learnt more try this:

http://www.tenancy-agreements.co.uk/lease.php