I am about to put an offer on a leasehold apartment in Tavistock. The property agents tell me that it is usual for flats in Tavistock to have less than 75 years remaining. I am getting a loan with The Mortgage Works. Is this going to be acceptable if the lease has 70 years remaining.
Most leasehold conveyancing experts should be able to deal with a lease extension. if you are securing a mortgage then your lender may insist that the lease be extended before competition. The Mortgage Works have specific requirements as set out in the UK Finance Lenders’ Handbook in relation to minimum unexpired lease terms. As of 23/9/2023 the requirements read as follows :
Where the unexpired lease term is different to that recorded on the mortgage offer, the following clarifies if we need to be informed:
Second hand property:
- If the unexpired lease term on the offer is 85 years or more - only advise us if the actual lease term is less than 85 years
- if the unexpired lease term on the offer is less than 85 years – advise us if the actual lease term is different than reported
- For equity share applications - advise us if the actual lease term is different than reported on the offer
New build property:
- If the unexpired lease term stated on the offer is 125 years (flat) / 250 years (house) or more - only advise us if the actual lease term is less than 125 years (flat) / 250 years (house)
- For equity share applications - always advise us if the actual lease term is different than reported on the offer
Lease terms such as ground rent and event fees must be reasonable at all times during the term of the lease and adhere to our requirements below. If you’re unsure as to whether the terms of a lease are unreasonable or onerous, please refer the details to us in plain English for Valuer consideration. If the potentially onerous terms are in relation to the ground rent please include the current ground rent figure per annum, how often it will be reviewed and the price structure it will be reviewed against. See the guidance below.
SECOND HAND PROPERTIES
Unacceptable - advise Issuing Office (Will be declined):
- Unexpired lease term less than 70 years
- Less than 30 years remaining at the end of the mortgage term
- Ground Rent greater than 0.5% of the property value
- Ground Rent doubles less than every 20 years (e.g. doubles every 5, 10 or 15 years) - acceptable if doubles every 20 years or more
- Ground Rent is compounded RPI
- Ground Rent review period less than or equal to 5 years
Refer to Issuing Office (Valuer will consider any impact on valuation figure and marketability):
- Unexpired lease term is 70 to 85 years
- Ground Rent greater than 0.1% and less than or equal to 0.5% of the property value
- Ground Rent escalation is linked to any indices greater than RPI
- Ground Rent escalation is linked to the value of the building*
- Ground Rent review period is greater than 5 and less than 10 years
- Event clauses exist for normal use e.g. changing the carpet, installing a TV aerial etc
- Estate Rent Charges greater than £500 p/a (please provide details of what the charges cover)
- Service Charges greater than 0.5% of property value p/a (please provide details of what the charges cover)
- Anything that appears onerous, unusual or out of the ordinary
Acceptable (no requirement to advise Issuing Office):
- Unexpired lease term greater than 85 years
- Ground Rent less than or equal to 0.1% of the property value
- Ground Rent review period greater than or equal to 10 years
- Ground Rent escalation less than or equal to RPI
NEW BUILD PROPERTIES (includes office conversions)
Unacceptable - advise Issuing Office (will be declined):
- Unexpired lease term less than 125 years on a new build flat or less than 250 years on a new build house
- Any lease which is subject to a ground rent (or annual rent) being charged which is more than on a peppercorn basis
- Any lease which is subject to a ground rent (or annual rent) being reviewed and altered on any review basis or methodology
Refer to Issuing Office (Valuer will consider any impact on valuation figure and marketability):
- Event clauses exist for normal use e.g. changing the carpet, installing a TV aerial etc
- Estate Rent Charges greater than £500 p/a (please provide details of what the charges cover)
- Service Charges greater than 0.5% of property value p/a (please provide details of what the charges cover)
- Anything else appears onerous, unusual or out of the ordinary
Acceptable (no requirement to advise Issuing Office):
- Unexpired lease term greater than or equal to 125 years on a new build flat or greater than or equal to 250 years on a new build house
- A lease subject to a peppercorn ground rent (annual rent) charges
For the avoidance of doubt, any new build properties completed but not sold pre 30 June 2022 will only be acceptable if the lease conforms to the above guidance
* Where the Ground Rent escalation is linked to the value of the building, please provide the following:
- How is the value of the block/unit currently calculated and if the assessment relates to the block(s), how is the Ground Rent calculated/apportioned per property?
- The current valuation and Ground Rent for each unit
- What is the mechanism for future valuations of the block and how is the Ground Rent calculated/apportioned?
- What is the right of appeal? And is this a documented process within the lease?
- Who bears the cost of the valuation (and appeal) process?
- Confirmation the review period is not less than twenty years
LEASE EXTENSIONS
We require all lease extensions to be completed under the Leasehold Reform Housing and Urban Development Act 1993 and to meet the above criteria as a minimum. Where you become aware that it does not meet these requirements, please refer to the Issuing Office
If you had a top tip for choosing a conveyancing solicitor in Tavistock what would it be?
We would encourage you not to go for the lowest Tavistock conveyancing quote. You really do get what you’re paying for when it comes to conveyancing solicitors. A cheap quote may mean that the conveyancing solicitor is handling a lot of jobs at one time and you won’t get the quality of service and the attention that you need. It is, however, wise to use a conveyancer who has a fixed fee on a no sale, no fee basis. This way, you know exactly what you’ll have to pay in ahead of the deal.
I just acquired a flat at auction in Tavistock. Conveyancing is required. What happens now?
Having legally committed yourself to purchase you should hire the services of a conveyancing lawyer soon as you are faced with a pending a fixed date to complete the purchase. An auction property should have a bespoke auction pack. This should include evidence of title and search results. In the case of leasehold premises the legal papers should provide a copy of the lease, management information and a sellers leasehold information form and other conveyancing documentation specific to a leasehold property. You need to pass this on to the lawyer working for you as soon as possible. Do make sure that that you have the requisite funding in place to complete the transaction on the set completion date.
Our sealed bid on a property in Tavistock has been agreed to, but there is a chain. The vendors have offered on on an apartment, however it’s not yet tied up, and are looking at other flats booked. I have instructed a local conveyancing solicitor in Tavistock. What should be my next step? When should I get the mortgage application with Nationwide started?
It is normal to have apprehensions where there is a chain as you are unlikely to want to incur costs too early (home loan application is approx one thousand pounds, then survey, Tavistock conveyancing search charges, etc). First, you should ensure that your property lawyer is on the Nationwide conveyancing panel. Regarding the subsequent phase this very much dictated by the specifics of your transaction, desire for the property and on the state of the market. During a hot market some home buyers would apply for the mortgage with Nationwide and pay for the valuation and only if it was satisfactory would they request their lawyer to proceed with the conveyancing in Tavistock.
I am selling my house. My past solicitors closed down. I am in need of a recommendation of a conveyancing firm. Im based in Tavistock if that makes a difference.
Do use our search tool to help you choose a solicitor for your conveyancing in Tavistock. We have connected thousands of home buyers and sellers with regulated solicitors to ensure that the legalities of their house move runs smoothly.
My father has urged me to appoint his lawyers for conveyancing in Tavistock. Do I take his guidance?
Much as we are happy to recommend a Tavistock conveyancing lawyer the ideal way to find a conveyancing solicitor is to have recommendations from friends or family who have actually used the conveyancer you're are thinking of instructing.
I am purchasing a garden apartment in Tavistock. Conveyancing solicitor has been awaiting, from the vendor, building insurance paperwork. Earlier today I was advised that the owner needs to forward the insurance paperwork for the flat above also. Why would my lawyer need to check the insurance for the flat above? Is it strictly necessary? We have been stalled for the previous fortnight…
It is not unheard of in leasehold conveyancing in Tavistock to find Conveyancing in Tavistock in a minority of cases reveals that the lease requires the leasehold owners to insure their individual flats as opposed to the freeholder insuring the entire premises - which is clearly preferable. You should clarify with your property lawyer but it would appear that your lawyer is seeking to establish that the whole building is insured. Insuring a ground floor apartment is no help when it comes to rebuilding after a fire if the other flat cannot be rebuilt as a result of lack of insurance cover.