Leasehold flat becoming unmortgagable due to freehold being unregistered

mandi_wilson

My friend owns a leasehold flat, mortgaged with Nationwide, and it's due to expire this year.  Although the lease is registered, the freehold is not.  Nationwide have apparently changed their lending criteria (along with most other lenders I've been told) such that they will not now lend against leasehold properties where the freehold is unregistered.  They have given him an agreement in principle for a Retirement Interest Only mortgage, but it is conditional upon the freeholder registering the freehold title with Land Registry. The freeholder is refusing. This means my friend (who is 74 and undergoing treatment for bowel cancer) cannot get a mortgage and will have to sell, but is unlikely to find a purchaser (other than at a massive reduction in value) as the property can only be sold for cash.  Surely this can't be right?  Any thoughts or advice gratefully received.

kirtondm

I am surprised he has not payed the mortgage off at 74. How much is left to pay?. Probably better off paying what little is left off the mortgage if possible?
If not a) Pay the freeholder enough money that they will register the freehold
          b) As above sell to a cash buyer.

user1977

mandi_wilson said:

Nationwide have apparently changed their lending criteria (along with most other lenders I've been told) such that they will not now lend against leasehold properties where the freehold is unregistered...Surely this can't be right?

It doesn't sound right. I'd have thought there'd be a huge number of unregistered freehold titles, given they typically don't change hands very often. Not sure why a lender would view it as being of great interest?