Mortgage Lenders and Short Leases

The first step in any lease extension procedure is to get a proper leasehold valuation, there are many lease extension calculators online but these can only provide an estimate.

When it comes to short leases almost every mortgage provider has a different lending policy. This can mean that, depending on which lender you chose, you may not be able to get a mortgage or re-mortgage!

Some mortgage providers have quite simple policies regarding the minimum lease they would lend to i.e. 70 years at mortgage application, or 35 years + the mortgage term (which is often 20 years).

And some mortgage providers have more complex terms, such as; 145 years minus x where x is the age of the youngest lender or Mortgage term + 30 years and 60 years remaining at drawdown.

The range is from 25 years + the mortgage term to 150 years minus the age of borrower.

At the bottom end this is actually very risky for a mortgage provider, as a property significantly loses value 'overnight' at 80 years, and as it approaches the 30-50 years mark the property value heads lower and lower (and the cost of extending the lease grows higher and higher).

If you're worried about your lease, try our lease extension calculator or give us a call on 0330 660 0287  and our team can check our database and advise you on which lenders will lend to short leases.