Ground rent

deuxchevaux

Bought new flat in 2015 ground rent at £300 then doubling every ten years which obviously finding myself caught on this issue now for sale lost 2 buyers over one year….from 1st buyer declining the clause got a deed of variations (taking 6months to be drafted) obviously lost the buyer.  Got the DRAFT which is now kept at £300 then as reaching the 10 years 2026 ( 5 years time) then RPI  this has just been refused by 2nd buyer lender and told last night buyer withdrawn.
what do I do please? Do I  agree with that deed of variations which by the way the landlord want £2000 + his solicitors fee £750 for it!  Or am i hitting myself on the wall meaning would still be with the over £250 that all lenders seem to require!
i have been told unsellable unless has the fortune to buy the leasehold!!
please help for advise much appreciated THANK YOU

deuxchevaux

Missed out after ten years 2026 kept the doubling £600 then RIP that is the draft at the moment …..HELP please 

eddddy

Most lenders say they will accept indemnity insurance for ground rents over £250.

See what they say here: https://lendershandbook.ukfinance.org.uk/lenders-handbook/englandandwales/question-list/1852/
But there's still a risk for the leaseholder.

Ground Rent doubling every 10 years would definitely have been a problem for the lenders.

But most lenders say that 'straight line' RPI increases are OK, and reviews every 10 years are OK. (But 'compounded' RPI increases are not acceptable. Is your freeholder wanting compounded RPI increases?)
 
But maybe lenders have got more strict since providing the info in the link above.



Are you aware of the CMA saying that the doubling ground rent clauses are unfair terms, and putting pressure on Developers and Freeholders to remove them?

Presumably, your developer / freeholder isn't on the list of companies who've agreed to remove those terms, or on the list of companies that the CMA is investigating.
See: https://www.ftadviser.com/mortgages/2022/03/29/cma-more-developers-under-microscope-for-ground-rents/

loubel

Have you considered applying for a statutory lease extension instead? This will reduce ground rent to a notional peppercorn. It could take a while and be more expensive but if the freeholder isn't amenable to a reasonable variation and your flat is otherwise unmortgageable it could be worth it.