We’ve probably all done it… sighed at the prospect of dealing with a Leasehold transaction. If you are not keen on Leasehold transactions do you think you have become complacent when you do have to deal with them?
Leases for flats generally run for between 99 and 125 years but, as with anything, the longer they have been owned for the less attractive they become to a potential new buyer, and often lenders. Some mortgage lenders may accept a lease that has around 60 years left whereas buyers may not be so willing. Many buyers are now realising that the longer they own the flat the more likely it is that any future potential buyer will be wary of a short lease term. This can be rectified but a new buyer isn’t likely to want to be saddled with the cost of a lease extension.
If you get a Leasehold transaction landing on your desk and the term of the Lease is dwindling it might be worth advising your Client to have an informal chat with their Landlord about extending the Lease. It will cost them money to extend their Lease but if you have mentioned it at the start of the transaction it is unlikely that it will become a time sensitive issue and the Landlord should offer an extension to the Lease at a reasonable price. While you are speaking to your Clients make them aware of the Leasehold Reform Act 1993, just in case a Landlord thinks he can take your Client for as much money as possible.
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