Why do I have to pay up front for conveyancing in Sawbridgeworth?
If you are buying a property in Sawbridgeworth your solicitor will ask you put them with monies to cover the search fees. Ordinarily this is needed to cover the fees of the Local Authority Search. If any deposit is as part of the sale price then this should be required shortly prior to contracts are exchanged. The final balance that is needed should be transferred a few days prior to the day of completion.
I am about to put a bid on a leasehold property in Sawbridgeworth. The estate agents advise that it is standard for flats in Sawbridgeworth to have less than 75 years remaining. I am taking out a mortgage with Nationwide Building Society. Is this going to be acceptable if the lease has Seventy One years left.
Most leasehold conveyancing experts should be able to deal with a lease extension. if you are obtaining a mortgage then your lender may insist that the lease be extended before competition. Nationwide Building Society have specific requirements as set out in the UK Finance Lenders’ Handbook in relation to minimum unexpired lease terms. As of 1/6/2025 the requirements read as follows :
- There must be at least 30 years remaining at the end of the mortgage term (regardless of the length of lease at the start).
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
- Where lending is over 85% of the purchase price/valuation on a second hand flat and the unexpired lease term on the offer is 90 years or more - only advise us if the actual lease term is less than 90 years.
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 55 years
- Unexpired lease term less than 90 years where we are lending more than 85% of the purchase price/valuation on a second hand flat
- 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 is 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 55 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 1% 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 (Minimum 90 years where we are lending more than 85% of the purchase price/valuation on a second hand flat)
- 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 (does not apply to Shared Ownership)
- 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 charged which is more than on a peppercorn basis
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 1% 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 Issuing Office.
Please ensure that all lender enquiries are submitted (with full documentation/requirements) at least 2 weeks prior to exchange to allow sufficient time for review and decisioning.
A friend recommended that if I am buying in Sawbridgeworth I should carry out a Neighbourhood, Planning and Local Amenity Search. Can you explain what the purpose of this search is?
A search of this type is usually quoted for as part of the standard Sawbridgeworth conveyancing searches. It is a large document of about 40 pages, listing and detailing significant information about Sawbridgeworth around the property and the people living there. It includes an Aerial Photograph, Planning Applications, Land Use, Mobile Phone Masts, Rights of Way, the local Housing Market, Council Tax Banding, the type of People living in the area, the dominant type of Housing, the Average Property Price, Crime details, Sawbridgeworth Education with maps and statistics, Local Amenities and other useful information regarding Sawbridgeworth.
Due to the encouragement of my in-laws I had a survey completed on a property in Sawbridgeworth ahead of instructing conveyancers. I have been informed that there is a flying freehold overhang to the property. Our surveyor has said that some lenders may refuse to issue a mortgage on this type of property.
It varies from the lender to lender. Bank of Scotland has different instructions for example to Birmingham Midshires. If you contact us we can check via the relevant bank. If you lender is happy to lend one our lawyers can assist as they are used to dealing with flying freeholds in Sawbridgeworth. Conveyancing can be more complicated and therefore you should check with your conveyancing solicitor in Sawbridgeworth to see if the conveyancing costs will increase in light of this.
I have just started marketing my 2 bed flat in Sawbridgeworth. Conveyancing has not commenced, however I have just had a half-yearly maintenance charge invoice – Do I pay up?
It best that you clear the invoice as usual given that all ground rent and maintenance charges will be apportioned on completion, so you will be reimbursed by the buyer for the period running from after the completion date to the next payment date. Most management companies will not acknowledge the buyer until the service charges have been paid and are up to date, so it is important for both buyer and seller for the seller to show that they are up to date. This will smooth the conveyancing process.
I own a leasehold flat in Sawbridgeworth, conveyancing having been completed half a dozen years ago. Can you please calculate a probable premium for a statutory lease extension? Corresponding flats in Sawbridgeworth with an extended lease are worth £165,000. The ground rent is £50 yearly. The lease finishes on 21st October 2103
With 78 years remaining on your lease the likely cost is going to be between £7,600 and £8,800 plus legals.
The suggested premium range that we have given is a general guide to costs for extending a lease, but we cannot give you the actual costs in the absence of comprehensive due diligence. You should not use the figures in a Notice of Claim or as an informal offer. There may be additional concerns that need to be considered and you obviously want to be as accurate as possible in your negotiations. Neither should you take any other action placing reliance on this information before getting professional advice.
My son is just in the process of moving home, the home loan was agreed last week in principle. One the offer was accepted on house we telephoned the bank to issue the formal offer. I was disappointed to hear that mortgage lenders do not accept all conveyancing practitioner, they must be on their panel, is this correct?
Lenders ordinarily restrict either the type or the number of conveyancing firms on their approved list of lawyers. A common example of such restriction(s) being that a firm must have two or more partners. In addition to restricting the type of firm, some have decided to limit the number of firms they use to represent them. You should note that banks have no responsibility for the quality of advice provided by any Sawbridgeworth solicitor on their panel. Mortgage fraud was a key driver in the rationalisation of conveyancing panels a few years ago and whilst there are differing views about the extent of solicitor involvement in some of that fraud. Statistics from the Land Registry reveal that thousands of law firms only carry out one or two conveyances a year. Those supporting conveyancing panel cuts ask why law firms should have the right to be on a Lender panel when clearly, conveyancing is not their speciality. To put it another way; would you want a conveyancing solicitor to represent you if you were charged with a crime? Unlikely.