Refinance of a flat with only 45 years left on the lease.   

Deal Structure

75% Loan To Value

£270k loan

Interest Rate @ 4.69% pa

5 year Fixed Rate

10 year Interest Only deal

6% Lenders Fee (added to the loan)

Deal Summary

Our client inherited a flat some time ago and was trying to refinance it to release some equity in order to purchase another Buy to Let property.

He told us he was having difficulty in getting finance from his usual providers because of the short term (45 years) left on the leasehold, which meant it was therefore falling outside lenders policies.

After doing some research we presented him with two options. One option was a straightforward loan from a specialist lender who would allow the refinance providing there was at least 35 years left at the end of the mortgage. However, we anticipated that the valuation of the flat would be impacted negatively due to the short lease remaining.

An alternative option was to negotiate an extension of the lease with the Freeholder. We spoke to a lender who agreed that they would be happy to value the property with the benefit of a 250 year lease provided that the lease extension was in place at completion.

Our client managed to secure an extended lease term and remortgaged the property at its enhanced value with a mainstream lender on better terms than he would have done without our assistance.

Contact Simon Parkinson

[email protected]