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SHORT LEASE...45years, please help

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  • SHORT LEASE...45years, please help

    Bare with, its my first post!!
    Anyone out there have advice for me?
    I have had an offer accepted on flat with "a new lease on completion". Knew it would be shortish but was a huge shock today when at the mortgage advisors and i found out it only had 45 years!!! Mortgage advisor is going to look into it but does anyone have any experience with banks who will lend to such short leaseholds?
    I am a single parent leaving the marital home with a 3 year old so things are compicated enough without this spanner in the works.
    Today I thought i was going for a quick appt to get mortgage agreed in principle and i came home so frustrated and upset, its just one thing after the other

    Should i try and push the vendor to extend lease now so that i can get a mortgage? Im assuming he wants to wait for the money from completion although i understand that there are huge risks involved with the lease not being extended at the last minute and i obviously dont want to be left with a property that i cant sell and cant afford to extend lease.
    I know he has already lost one buyer because they couldnt get a mortgage but obviously the EA didnt tell me why (grrrrrr). Im wondering if i can sell it to them as "its either this or you have to sell to cash buyer" because im pretty sure no-one else would be able to get mortgage

    Also I had a quick look online and as an example it said a 60 years unexpired lease could cost about 20k+ to renew so im thinking that a 45 year old lease would be HUGE amounts of money

    Sorry this is waffly but I feel so crestfallen and in need of some advice

  • #2
    Re: SHORT LEASE...45years, please help

    I dont know anyone who would lend on such a short lease but i would get the agent to raise this with the seller . If you are finding it difficult to find someone to lend on this property then anyone else would also find it difficult

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    • #3
      Re: SHORT LEASE...45years, please help

      Although needing a bit of cash - a bit of professional advice on this cannot go amiss.

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      • #4
        Re: SHORT LEASE...45years, please help

        I have had an offer accepted on flat with "a new lease on completion".
        Doesn't this mean that they are going to have a new lease granted on completion for a longer period and 45 years is the length of the existing lease?

        If so you simply need to ask how long the new lease will be.
        RICHARD WEBSTERwww.rwco.co.uk
        As a conveyancing solicitor I want to be helpful (England/Wales only) but can't accept liability for this.

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        • #5
          Re: SHORT LEASE...45years, please help

          I think Richard Webster has hit the nail on the head. You must establish what the lease length is before proceeding. Normally, a new lease is 99, 125 or 999 years, although it can be any length.

          It is true that there are far fewer potential buyers for a short lease property (unless it is in Prime Central London, where it can be seen as advantageous) as Lenders all have their own restrictions regarding lease length. Cash buyers might pick up a bargain, owing to the lack of competing purchasers, but they have to factor in the likely cost of extending the lease.

          Another matter is that the new owner will have to wait two years before they can have a Statutory Lease Extension. To avoid this, the vendor can start the process before selling (if the vendor has owned the property for at least two years) and pass the benefit on to the purchaser.

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          • #6
            Re: SHORT LEASE...45years, please help

            The seller should be told that he needs to organise a lease extension with his freeholder/landlord to be completed at the same time as the completion of the purchasing effectively using your money but so that the newly extended lease is transferred to you.

            If the seller cannot organise that then you can't buy as you need a mortgage and he will have trouble selling the flat except to a cash buyer who will negotiate him into the floor for taking on the hassle and risk involved in getting the extension. If there are plenty of other flats out there why buy trouble?
            RICHARD WEBSTERwww.rwco.co.uk
            As a conveyancing solicitor I want to be helpful (England/Wales only) but can't accept liability for this.

            Comment

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